JOURNAL ARTICLE
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Beteiligungen deutscher Geschäftsbanken und Corporate Performance
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 116 (1996), Iss. 2 : pp. 273–310
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Schmid, Frank A.
Abstract
The impact of shareholder structure on firm performance is analysed for a sample of German stock corporations. All sample firms are characterized by equity interests of banks by the end of the year 1990. Size and structure of these equity participations are accounted for. No empirical evidence for the influence of banks on return on assets is found. However, the results obtained for return on equity and for the interest burden on debt support the view that banks demand compensation for corporate control exercised on these corporations. Thus, restrictions on equity interests are expected to discourage banks to be active investors. Such regulations would hinder the emergence of optimal shareholder structures and would impose inefficiencies on corporate control in Germany.