The Role of Banks in Governing Non-Financial Companies

Authors

  • Alejandro R. O'Sullivan Common Market for Eastern and Southern Africa

Abstract

Our article consists in studying the important role of banks in the governance of Tunisian non-financial companies listed and observed between 2004 and 2008. The analyses in the framework of this work also reveal important results. First, the presence of the bank within the firm whether as a creditor or shareholder, is costly for the firm and destroys the value of the latter. In addition, the variables, growth opportunities, performance, majority shareholder, bank debt, shareholder bank as well as profitability ratio exert a significant influence on the motivation of banks to acquire stakes and grant credits to non-financial firms. Finally, in the Tunisian context, the Bank-Company relationship increases conflicts of interest to the detriment of monitoring advantages, which weakens the effectiveness of the bank as a monitor and leads to the destruction of the value of the firm

Published

2024-07-11

How to Cite

Alejandro R. O’Sullivan. (2024). The Role of Banks in Governing Non-Financial Companies. Pooda Journal of Business Marketing, Finance, And Accounting Studies, 14(2). Retrieved from https://pooda.org/index.php/pooda/article/view/332

Issue

Section

Articles