The Effect of Risk Taking On Ownership Structure and Bank Performance: A Malaysia Case

• Main Authors: Abdul Rahman, Nora Azureen, Rejab, Anis Farida
• Format: Conference or Workshop Item
• Language: English
• Published: 2018
• Subjects: HG Finance
• Online Access: http://repo.uum.edu.my/25291/1/GAFEC%202013%201.pdf; http://repo.uum.edu.my/25291/
• Institution: Universiti Utara Malaysia

This paper analyses the impact of ownership structure on bank performance and the interaction effects of bank risk taking which is proxied by loan concentration, on the relationship. Using secondary data, the empirical analysis of this study is confined to Malaysian commercial banks during the periods of 2000 to 2011. Hierarchical moderated multiple regression with fixed effects model is used to test the research model. Testing on five categories of ownership such as insider, family, government, institutional and foreign ownership, the results suggest that bank performance varies with different types of ownership. The results show that high concentration of insider, government and Institutional ownership reduced bank performance while high family and foreign ownership have no significant impact on bank performance. The regression results also show that the impact of ownership structure on bank performance is affected by the banks' risk taking whereby high exposure to risk reduces the bank performance.