Journal of
Economics and International Finance

  • Abbreviation: J. Econ. Int. Finance
  • Language: English
  • ISSN: 2006-9812
  • DOI: 10.5897/JEIF
  • Start Year: 2009
  • Published Articles: 348

Full Length Research Paper

Financial performance and ownership structure of Ethiopian commercial banks

Deepak Kapur and Abebaw Kassie Gualu
Faculty of Business Management and Commerce, University Business School, Panjab University, Chandigarh 160 014, India. University Business School, Panjab University, Chandigarh, 160 014, India.
Email: [email protected]

  •  Accepted: 20 December 2011
  •  Published: 07 January 2012

Abstract

It has been argued since long time that private ownership of firms leads to better firm performance. Knowledge of the relationship of performance and ownership is assumed to have significance importance. This paper is an empirical analysis on the impact of ownership structure on the performance of Ethiopian commercial banks. We examined whether the ownership structure of banks significantly impinges on bank performance. We used eight Ethiopian commercial banks from 2001 to 2008 period. We have employed both parametric and nonparametric tests of differences among public and private sector banks. Results revealed that private sector banks had better profitability, asset quality and capital adequacy performance and public sector banks were better in cost management measures. In terms of liquidity, no difference was observed between the private and public sector banks.

 

Key words: Banking, financial performance, ownership, Ethiopia.