The Effect of Multiple Large Shareholders on Banks’ Profitability and Risk

Soana, Maria Gaia; Barbieri, Laura; Lippi, Andrea; Rossi, Simone

doi:10.3390/su13041888

Cited by 7 publications

(7 citation statements)

References 82 publications

(109 reference statements)

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“…Therefore, if the monitoring effect of share ownership by institutional investors occurs, it is expected to have a positive impact on corporate performance. The previous studies show that institutional ownership positively affects profitability (Soana et al, 2021;Sakawa & Watanabel, 2020;Amanda et al, 2020;Nurkhin et al, 2017;Ozili & Uadiale, 2017). Thus, the proposed hypothesis is: H3: Institutional ownership affects the profitability of the banking sector listed on the Indonesia Stock Exchange Working Capital Management and Profitability Working capital management (WCM) is short-term financial management used to control and manage current assets and liabilities that involve short-term cash flows in the company's operating cycle (Seth et al, 2019).…”

Section: Literature Review Intellectual Capital and Profitabilitymentioning

confidence: 99%

“…Then, Jihadi et al (2021), Chen et al (2019), Aggarwal &Padhan (2017), andDalci (2018) find that financial leverage has a positive effect on profitability. Furthermore, research conducted by Soana et al (2021), Sakawa & Watanabel (2020), Amanda et al (2020), Nurkhin et al (2017), andOzili &Uadiale (2017) show that institutional ownership positively affects profitability. Several research results also agree that WCM affects company profitability (Gonçalves et al, 2018;Godswill et al, 2018;Morshed, 2020;Pham et al, 2020;Senan et al, 2021).…”

Section: Introductionmentioning

confidence: 99%

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Assessing determinant of firm value: Indonesia conventional bank analysis

Rahmi,

Muhammmad Arfan,

Mulia Saputra

2023

J. Akun. Audit. Ind.

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The objective of this paper is to examine the factors of intellectual capital, financial leverage, institutional ownership, and working capital management (WCM) on firm value and the role of profitability as a mediator in influencing firm value. The research analysis unit focuses on the conventional banking sector on the Indonesia Stock Exchange. The panel data was taken from 28 commercial banks for five years (2016–2020), with 140 observations and data is analyzed using path analysis. Based upon the result of hypothesis testing, the study concludes that the positive correlation between profitability and firm value. Furthermore, intellectual capital, financial leverage, institutional ownership, and WCM also positively affect firm value and profitability. Based on data analysis using path analysis by comparing the path coefficient substructure, the results show that profitability acts as a mediator the effect of intellectual capital, financial leverage, institutional ownership, and WCM on firm value.

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Section: Literature Review Intellectual Capital and Profitabilitymentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Assessing determinant of firm value: Indonesia conventional bank analysis

Rahmi,

Muhammmad Arfan,

Mulia Saputra

2023

J. Akun. Audit. Ind.

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“…Capital adequacy indicates the level of banks’ compliance with regulations of the minimum capital reserve amount. The capital structure concentration for any bank is highly important, as shown in [ 24 ], whose findings revealed that the number of large and institutional shareholders of banks has a positive effect only on profitability, not on risk.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Other scholars have explored banks’ management quality through the implementation of best corporate governance and social responsibility practices [ 24 , 51 – 53 ]. [ 51 ] applied different corporate governance practices in banks (i.e., female independent directors, CEO duality, and CEO shareholding) and found that bank financial performance was positively affected by these practices.…”

Section: Literature Reviewmentioning

confidence: 99%

Key determinants of deposits volume using CAMEL rating system: The case of Saudi banks

AL-Najjar

Assous

2021

PLoS ONE

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CAMEL is considered one of the well-known banking rating systems used to build a proper bank ranking. In our paper, we investigate the CAMEL rating for Saudi banks, which is considered the second largest banking sector in GCC. The Saudi banking sector consists of 11 banks and is the leading sector in the Saudi stock index (TASI). In this research, we aim to determine the ranking of Saudi banks according to CAMEL composite and CAMEL overall ratings and explore the effects of these ratings on banks’ total deposits for the period from 2014 to 2018. The methodology involves four phases. In the first phase, we calculate the key financial ratios of CAMEL’s composites for each bank. In the second phase, we rank the banks from 1 to 11 to each one of CAMEL’s composites for each bank per year. In the third phase, we rank Saudi banks according to CAMEL composite and CAMEL overall. Finally, in the fourth phase, we run a regression model using CAMEL financial ratios rank as independent variable and banks’ total deposits as a dependent variable. Using the stepwise regression method, the results indicated that the best regression model has an adjusted R2 of 73.4% and a standard error of around 0.58. The results further indicated that capital measured by CAR, management as an efficiency ratio, earning with ROE proxy, and liquidity as loans to deposits have positive effects on banks’ total deposits. Meanwhile, earnings as net interest income to net revenue and liquidity calculated by CASA have a negative effect on banks’ total deposits. Finally, asset quality ratios and the rest of the ratios have no significant effect on banks’ total deposits.

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“…Activity ratios show how quickly an enterprise pays its debts and collects receivables as well as how effectively it manages its inventory. Profitability indicators express the relationship between operating profits, net sales revenues, total assets, and equity [47,70,71]. The profitability of forest districts is primarily determined by their costs (optimized by the State Forests management) and revenues, which depend on natural conditions (volume and quality of timber) and market demand.…”

Section: Ratio Analysis As a Tool For Evaluating The Financial Performance Of Forest Districtsmentioning

confidence: 99%

The Effects of Natural and Economic Factors on the Financial Performance of Forest Management Units: The Example of Forest Districts of the State Forests National Forest Holding from Eastern Poland

Kożuch

Marzęda²

2021

Forests

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Given the changing market conditions and uncertainty arising from climate change, forest management tends to focus on the financial functioning of forest holdings. The objective of this work is to study the financial performance of forest districts using ratio analysis, synthetic financial indicators, as well as the relationship between synthetic indicators and forest district categories defined in terms of forest site type, site fertility, compatibility stand species composition, species composition, harvesting system, harvesting intensity, fragmentation of forest complexes and management difficulty level. The study material consists of financial documentation from 82 forest districts of the State Forests National Forest Holding (SFNFH) in eastern Poland from the years 2015–2019 and 2005–2009 (for comparison purposes). Synthetic indicators were calculated using two sets of financial ratios as well as two variants of accounting data. In the study period, forest districts were found to differ in terms of their financial performance, which was affected by the natural and economic factors. The synthetic indicators were significantly higher (p > 0.05) for forest districts operating on low-fertility lowland sites, those managing stands with dominant pine, and those implementing a clearcutting regeneration system. The findings concerning the effects of selected natural and economic factors on the financial condition of forest districts may be used for financial planning and management by SFNFH, in particular in decision-making processes to optimize forest management. The applied methods may stand as a basis for the construction of a sectoral evaluation tool.

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The Effect of Multiple Large Shareholders on Banks’ Profitability and Risk

Cited by 7 publications

References 82 publications

Assessing determinant of firm value: Indonesia conventional bank analysis

Assessing determinant of firm value: Indonesia conventional bank analysis

Key determinants of deposits volume using CAMEL rating system: The case of Saudi banks

The Effects of Natural and Economic Factors on the Financial Performance of Forest Management Units: The Example of Forest Districts of the State Forests National Forest Holding from Eastern Poland

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