Does Ownership Structure Matter for Bank Performance in the MENA Region? An Empirical Evidence

  • Sara Fathi German University in Cairo
  • Mona A. ElBannan German University in Cairo, Egypt
DOI: https://doi.org/10.5296/ajfa.v9i2.11942

Abstract

The aim of this study is to examine the effect of bank ownership structure on bank performance in Middle East and North Africa (MENA) region using the balanced scorecard (BSC) method. Usinga panel data of 137 commercial banks during the period from 2010 to 2014 across twelve countries in the MENA region, the study highlights the effect of ownership type and concentration on bank performance using the balanced scorecard as a performance measurement technique. The results show that government ownership and foreign ownership have statistically significant positive effect on bank performance measured by BSC index. On the contrary, domestic private ownership and ownership concentration have statistically significant negative effect on bank’s BSC index. Additional analysis on each of the BSC perspective separately reveals that ownership concentration is negatively correlated with the customer and learning and growth factors, while positively correlated with the internal process factor. Government ownership shows statistically significant negative effect on the financial factor and the internal process factor while associated with statistically significant positive effect on the customer factor. Foreign ownership has statistically significant positive effect on the financial and the internal process factor but does not have statistically significant effect on the other two perspectives. Finally, Domestic private ownership reveals a statistically significant negative effect on the learning and growth factor.

Author Biography

Mona A. ElBannan, German University in Cairo, Egypt

Mona Elbannan is a full-time Assistant Professor of Finance, Department of Accounting and Finance, Faculty of Management Technology, the German University in Cairo (GUC). She received a Ph.D. degree in Business Administration with concentration in Finance from Ain-Shams University and B.S. in Economics from faculty of Economics and Political Science, Cairo University. She has more than 13 years academic teaching experience in reputable educational institutions such as the American University in Cairo and other universities. Her research interests lie in the areas of corporate governance, corporate finance, bank management and risk analysis. She focuses on studying the effects of banking sector restructuring and corporate governance mechanisms on bank disclosure, performance, value and risk-taking. She has published a number of papers on these issues in reputable academic journals listed in the Journal Quality List published by the Australian Business Deans Council (ABDC) and the Association Business School (ABS). She made several conference presentations in established academic forums internationally through years 2012 - 2014. She received the Best Paper Award at the 6th Annual American Business Research Conference held in New York, USA, 9-10 June 2014. In addition, she won the Highly Commended Paper Award in the 2016 Emerald Literati Network Awards for Excellence for her paper “Do consolidation and foreign ownership affect bank risk taking in an emerging economy? An empirical investigation” published in Managerial Finance, 2015, Vol 41 (9). Her experience also includes years of professional service in the Egyptian banking sector in the areas of credit analysis and international transfers. She also provided several training workshops and seminars in executive and professional education.

 

Published
2017-10-29
Issue
Vol. 9 No. 2 (2017)
Section
Research Articles

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