Ownership Structure, Corporate Governance And Bank Productivity In Africa: A Biennial Malmquist Approach

ABSTRACT

The study provides a total factor productivity index for the banking industry. The study decomposes the components of overall productivity to determine drivers of productivity. Also, it seeks to examine the bank operational effectiveness by comparing any possible differences between efficiency and productivity scores among state, private and foreign banks. Finally, the study investigates the impact of ownership structure and corporate governance on bank productivity and also examines the effect of foreign banks’ presence on local bank productivity.

Using panel data from 2008 to 2012 sourced from Bankscope, the Biennial Malmquist Index and the truncated bootstrapped regression technique, the study finds a general decline in Africa’s bank productivity. This may be as a result of the lack of technological advancements and innovation. Even though private banks are the most efficient, comparisons indicate that state banks in Africa are more productive. This may be due to the home-field advantage. Among regional blocs, results indicate that banks in West Africa are the most productive whiles the collective productivity scores for banks in North Africa are stagnant. Over the period, bank productivity in Southern Africa and East Africa is on the decline. European banks have a negative and significant impact on productivity in Africa. For perspectives on policy, it is recommended that management of banks, governments, regulators and all stakeholders in Africa should continuously invest in state-of-the art technology, adopt innovative processes in their operations and implement cost management strategies especially in their non-traditional activities to boost productivity.

Keywords: Productivity, Efficiency, Biennial Malmquist index, Banks, Ownership, Corporate governance, Truncated bootstrapped regression.

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APA

NARTEY, S (2021). Ownership Structure, Corporate Governance And Bank Productivity In Africa: A Biennial Malmquist Approach. Afribary. Retrieved from https://afribary.com/works/ownership-structure-corporate-governance-and-bank-productivity-in-africa-a-biennial-malmquist-approach

MLA 8th

NARTEY, SARAH "Ownership Structure, Corporate Governance And Bank Productivity In Africa: A Biennial Malmquist Approach" Afribary. Afribary, 12 Apr. 2021, https://afribary.com/works/ownership-structure-corporate-governance-and-bank-productivity-in-africa-a-biennial-malmquist-approach. Accessed 21 Jul. 2024.

MLA7

NARTEY, SARAH . "Ownership Structure, Corporate Governance And Bank Productivity In Africa: A Biennial Malmquist Approach". Afribary, Afribary, 12 Apr. 2021. Web. 21 Jul. 2024. < https://afribary.com/works/ownership-structure-corporate-governance-and-bank-productivity-in-africa-a-biennial-malmquist-approach >.

Chicago

NARTEY, SARAH . "Ownership Structure, Corporate Governance And Bank Productivity In Africa: A Biennial Malmquist Approach" Afribary (2021). Accessed July 21, 2024. https://afribary.com/works/ownership-structure-corporate-governance-and-bank-productivity-in-africa-a-biennial-malmquist-approach