Ownership structure and bank performance : evidence from the middle east and north Africa

الملخص EN

This paper makes a strong contribution to business literature by investigating the effects of organizational form and ownership structure on firm performance.

The paper traces the ownership details of 249 banks in 20 Middle Eastern and North African countries (MENA), with a total of 567 observations during the sample years of 2000-2002.

The results reveal that private banks, especially banks with substantial foreign private ownership, perform significantly better than all other sample bank groups.

Government banks have the weakest performance and substantially lag behind other sample bank groups.

Banks involved in the stock exchanges and banks with foreign ownership within the MENA region perform well in most estimations.

Importantly, the evidence shows that the extent of the overall presence of foreign banks in a given country is associated with better performance of individual banks.

An additional robustness check shows that findings are strong and consistent even after adjusting for time and country differences among the sample banks.

In summary, the findings of this paper highlight a sector of the MENA economy rarely investigated in such detail in the past despite its tremendous importance in the development process.

It also reveals that the combined effort of domestic and foreign investors is beneficial to firm performance and growth.