Performance Evaluation of Taiwan Banking Industry with the Consideration of Corporate Governance and Risk Management

• Main Authors: Chiang Pei Yen, 江蓓妍
• Other Authors: 傅祖壇
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/wk366k

碩士 === 東吳大學 === 經濟學系 === 102 === This study investigates the impact of corporate governance and operational risks on the performance of Taiwanese banking industry. We used the panel data of 35 Taiwanese commercial banks in 2007-2012. Previous researches on bank performance mostly employed single financial and accounting indicators which failed to show aggregated performance of banks. In this study, in addition to single financial indicators such as Return to Asset (ROA) and Return to Earnings (ROE), we also used aggregated performance indicators including cost and profit efficiencies to evaluate banks’ performance. The latter two indicators were estimated by the Stochastic Frontier analysis method. The corporate governance variables representing dimensions of board of directors and ownership structure were used to evaluation their impacts on the performance of the banks in Taiwan. The empirical results reveal that (1) The size of board of directors has positive correlations with cost efficiency and profit efficiency (2) The independent directors has played negative role on banks’ profit efficiency, and also negative impacts on traditional financial indicators. (3) The joint appointment of President and General Manager would result in positive impact on profit efficiency, and also positive impact on ROA. (4) The share of stock holding by major shareholders would have negative correlation with cost efficiency, and also negative correlations with ROA and ROE. (5) The share of stock holding by managers could have negative impact on cost efficiency. (6) The share of stock holding by institutional shareholders is positively correlated with cost efficiency. These empirical results from this study could be useful information to Taiwanese bank managers for improving their banks’ performance.