State Ownership and Risk-Taking Behaviour: Evidence from Malaysia's Banking Industry
This study investigates state ownership on risk-taking behaviour in Malaysias banking industry. Using the panel of Malaysian commercial banks, this paper examines whether banks risk-taking is affected by Malaysian government ownership through the five largest investment arms of Malaysia (GLICs). The...
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| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
UUM Press
2020
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| Subjects: | |
| Online Access: | https://repo.uum.edu.my/id/eprint/29227/1/IJBF%2015%2002%202020%2065-94.pdf https://repo.uum.edu.my/id/eprint/29227/ https://doi.org/10.32890/ijbf2020.15.2.4 |
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| Summary: | This study investigates state ownership on risk-taking behaviour in Malaysias banking industry. Using the panel of Malaysian commercial banks, this paper examines whether banks risk-taking is affected by Malaysian government ownership through the five largest investment arms of Malaysia (GLICs). The findings show that state-owned banks exhibit higher risk-taking behaviour compared to the private-owned banks in terms of loans. There is evidence that a higher degree of state ownership has a more significant impact on banks risk-taking behaviour. We also investigate the relationship with corporate governance mechanisms. The findings suggest that the composition of board of directors somehow plays a significant role in the governance of banks. |
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