This study examines the relationship between ownership structures and the performance of listed Thai financial firms, using a sample of 39 companies which is accounted for 86% of the market capitalisation of all financial firms listed on the Stock Exchange of Thailand (SET) in 1996. The study employs both univariate and multivariate regression analysis. The empirical results reveal that the presence of controlling shareholders is associated with higher performance, particularly when measured, for example, by return on equity (ROE). This evidence is consistent with the view that large shareholders mitigate the “free-rider” problem of monitoring a management team, and reduce agency costs, as contended by Shleifer and Vishny (1986) and Admati et al. (1994). In addition, the separation of voting and cash-flow rights through the use of pyramid and cross-shareholding is not detrimental to the value of a firm. The study does not find evidence to support the argument that a family's involvement in management has a negative effect on company performance. Rather, there is strong evidence to support the hypotheses that state-owned financial institutions display superior performance. Finally, the study does not find evidence to support the argument that there is a non-monotonic relationship between ownership concentration and company value. Nevertheless, there is strong evidence that, at higher levels of ownership (in this case 50-75%), the involvement in management by controlling shareholders has a positive effect on firm performance, in terms of accounting, ROE, and market measures, price-to-book ratio. The results add to the literature that evaluates an empirical the link between ownership structure and firm performance, and provide additional information to policy-makers engaged in the ongoing development of corporate governance in developing countries, particularly in Thailand. / Thesis (DBA(DoctorateofBusinessAdministration))--University of South Australia, 2005.
| Identifer | oai:union.ndltd.org:ADTP/267403 |
| Creators | Preedanan, Narong. |
| Source Sets | Australiasian Digital Theses Program |
| Language | English |
| Detected Language | English |
| Rights | copyright under review |
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