Does ownership concentration affect banks’ credit risk? Evidence from MENA emerging markets

Jabbouri, Imad; Naili, Maryem; Almustafa, Hamza; Jabbouri, Rachid

doi:10.1111/boer.12345

Cited by 9 publications

(4 citation statements)

References 92 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Friday and Gordon (2002 also document the decline in value relevance of earnings during the Mexican crisis of 1995. We also argue that this loss of investor confidence in information should be more pronounced in emerging markets, where information disclosure is usually considered as less reliable relative to developed countries (Ball et al, 2003;Jabbouri et al, 2019;Jabbouri et al, 2023;Leuz et al, 2003).…”

Section: Economic Uncertainty Familiarity Bias and The Value Of Adver...mentioning

confidence: 86%

Economic policy uncertainty nexus with the value relevance of advertising: Evidence from an emerging market

2023

Self Cite

View full text Add to dashboard Cite

This paper aims to document the effect of economic policy uncertainty on the value of advertising expenditures within the context of an emerging market. The paper shows that the value of advertising expenditures is an increasing function of economic policy uncertainty. The impact of advertising on firm performance is more pronounced during the periods characterized by higher economic policy uncertainty. We argue that, during uncertain times, the financial information loses its relevance. Therefore, during these periods, non‐financial traits, such as brand image, customer equity, relationship capital, and familiarity that characterizes firms with high advertising become more important. The findings hold in various sub‐samples and across various proxies of advertising activity. The findings also hold under alternate estimation procedures (pooled OLS regression, panel data with fixed effects and instrument variable regression). More importantly, this paper also shows that, relative to other agency reducing mechanisms (such as analyst coverage, asset utilization ratio, expense ratio and dividend payments), advertising is more valuable during periods with high economic policy uncertainty.

show abstract

Section: Economic Uncertainty Familiarity Bias and The Value Of Adver...mentioning

confidence: 86%

Economic policy uncertainty nexus with the value relevance of advertising: Evidence from an emerging market

2023

Self Cite

View full text Add to dashboard Cite

show abstract

“…They report higher levels of risk aversion during the periods characterized by high economic uncertainty. Prior literature holds heightened information asymmetries as the main reason behind the increase in risk aversion during the periods characterized by high economic uncertainty (Jabbouri et al ., 2019, 2023a; Brogaard and Detzel, 2015; Pastor and Veronesi, 2012). Higher information asymmetries induce capital providers to reassess the riskiness of firms and embrace a more cautious (risk averse) attitude about their investment choices (Jabbouri and Naili, 2019).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

The nexus between economic policy uncertainty and access to finance: a study of developing countries

Farooq

Jabbouri

Naili

2023

IJMF

Self Cite

View full text Add to dashboard Cite

PurposeThis paper attempts to document the effect of economic uncertainty on financing constraints faced by private firms.Design/methodology/approachOrdered logistic regression is used to analyze the data of private firms from 101 developing countries. The data was provided by the World Bank's Enterprise Surveys and was gathered during the period between 2006 and 2019.FindingsThe findings show that firms headquartered in countries with high economic uncertainty face more financing constraints than firms headquartered in countries with low economic uncertainty. The authors argue that the increase in economic uncertainty allows capital providers to adjust their lending decisions by reducing the provision of capital to firms. The paper also shows that firms headquartered in countries with strong institutional infrastructure and well-functioning firms are less likely to be affected by economic uncertainty while accessing finance.Practical implicationsThe findings would help managers, investors, regulators, and policymakers better understand the implication of economic policy uncertainty on the real economy. This study also sheds the light on the importance of minimizing volatility, ambiguity, and randomness in governmental decisions and policies. Regardless of the pertinence of these policies, arbitrariness surrounding their development and communication can limit their effectiveness and produce unwanted effects.Originality/valueThis paper is closely related to prior literature that documents the behavior of credit providers and investors (the supply side) during the periods of economic uncertainty. The authors differ from this strand of literature by taking the perspective of firms – the demand side.

show abstract

“…Therefore, this study uses the percentage of shares owned by the shareholders for Malaysian and Singaporean companies (Sraheen, Yunos, Smith, & Ismail, 2010). The concentration of ownership is measured by the proportion of the number of shares owned by the largest shareholders with more than 20% ownership (Chen et al, 2021;Jabbouri, Naili, Almustafa, & Jabbouri, 2022).…”

Section: Independent Variablesmentioning

confidence: 99%

Ownership concentration, sustainability practices, and cost of debt: Evidence from ASEAN countries

Sukmadilaga

Santoso

Ghani

2023

5002

View full text Add to dashboard Cite

This study examines the effect of ownership concentration on sustainability practices and the cost of debt. Subsequently, this study examines whether the performance of sustainability practices influences the cost of debt of public listed companies in three ASEAN countries. This study performed a content analysis on the annual reports of 93 public listed companies in Singapore, Malaysia, and Indonesia. The data analysis showed that ownership concentration has a significant negative effect on the cost of debt but no significant effect on sustainability practices. It also showed that there is a significant negative effect of sustainability practices on the cost of debt. Such findings could be attributed to the differences in business relationships between investors and companies and the non-linear relationship between ownership concentration and sustainability practices. This study provides evidence that both ownership concentration and sustainability practices negatively affect the cost of debt of the public listed companies. From the findings, it is recommended that public listed companies should refocus and strategize ways to mitigate the negative effect of ownership concentration and sustainability practices on the cost of debt, particularly in developing countries.

show abstract

Does ownership concentration affect banks’ credit risk? Evidence from MENA emerging markets

Cited by 9 publications

References 92 publications

Economic policy uncertainty nexus with the value relevance of advertising: Evidence from an emerging market

Economic policy uncertainty nexus with the value relevance of advertising: Evidence from an emerging market

The nexus between economic policy uncertainty and access to finance: a study of developing countries

Ownership concentration, sustainability practices, and cost of debt: Evidence from ASEAN countries

Contact Info

Product

Resources

About