Executive compensation, ownership structure and loan quality of banks in Ghana
Executive compensation, ownership structure and loan quality of banks in Ghana
This paper analyses the effects of executive compensation and ownership structure on loan quality of banks. The study uses a panel data on 26 Ghanaian banks over the period, 2003–2011. Using a dynamic panel model, estimations are made using the Generalized Method of Moments. The results show that management is efficient when director shareholding is very prominent in banks. Institutional ownership and public listing of banks also have a significantly negative relationship with non-performing loans, while lag of non-performing loans, equity ratio, exchange rate depreciation and increases in net interest margins are seen to have a negative effect on loan quality. Executive compensation had no significant effect on loan monitoring.
331–341
Adjei-Mensah, Gifty
d062e686-9556-4167-af1f-a8eee557750a
Amidu, Mohammed
e1f29abb-a4a2-4517-8ef9-9f4808556748
Abor, Joshua Yindenaba
fc2a8e9b-c46c-4ff1-9611-51f0fadcbd07
17 September 2015
Adjei-Mensah, Gifty
d062e686-9556-4167-af1f-a8eee557750a
Amidu, Mohammed
e1f29abb-a4a2-4517-8ef9-9f4808556748
Abor, Joshua Yindenaba
fc2a8e9b-c46c-4ff1-9611-51f0fadcbd07
Adjei-Mensah, Gifty, Amidu, Mohammed and Abor, Joshua Yindenaba
(2015)
Executive compensation, ownership structure and loan quality of banks in Ghana.
African Development Review, 27 (3), .
(doi:10.1111/1467-8268.12151).
Abstract
This paper analyses the effects of executive compensation and ownership structure on loan quality of banks. The study uses a panel data on 26 Ghanaian banks over the period, 2003–2011. Using a dynamic panel model, estimations are made using the Generalized Method of Moments. The results show that management is efficient when director shareholding is very prominent in banks. Institutional ownership and public listing of banks also have a significantly negative relationship with non-performing loans, while lag of non-performing loans, equity ratio, exchange rate depreciation and increases in net interest margins are seen to have a negative effect on loan quality. Executive compensation had no significant effect on loan monitoring.
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e-pub ahead of print date: 17 September 2015
Published date: 17 September 2015
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Local EPrints ID: 489271
URI: http://eprints.soton.ac.uk/id/eprint/489271
PURE UUID: bf7762b3-7b8d-441a-af78-1668fd1975cb
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Date deposited: 18 Apr 2024 17:06
Last modified: 19 Apr 2024 02:07
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Author:
Gifty Adjei-Mensah
Author:
Mohammed Amidu
Author:
Joshua Yindenaba Abor
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