Corporate governance, bank risk and performance: evidence from Africa

Volume 10, Issue 1, February 2025     |     PP. 1-24      |     PDF (297 K)    |     Pub. Date: March 12, 2025
DOI: 10.54647/economics790494    10 Downloads     61 Views  

Author(s)

Simms Mensah Kyei, Akenten Appiah-Menka University of Skills Training and Entrepreneurial Development, Kumasi, Ghana.

Abstract
This paper examines the relationship between corporate governance, bank risk and performance using 635 banks selected from 48 countries in Africa. Data span 2000-2019 at yearly frequency. Implementing a GMM approach, we find that bank risk has significant negative impact on bank performance. Corporate governance variables (board size, role duality, board meetings, independent directors) have significant negative impact on bank performance except for female directors which has significant positive impact on bank performance. Moderating the relationship between bank risk and bank performance with corporate governance variables, we observe a reduction in the negative impact of banks risk on performance in Africa. This study may guide regulators of banks to come out with appropriate corporate governance codes to assist in the reduction of risk and improve performance. Shareholders and management of banks may also make appropriate board appointments and apply best corporate governance practices to improve performance and reduce risk.

Keywords
Bank Risk; Bank Performance; Corporate Governance; Africa.

Cite this paper
Simms Mensah Kyei, Corporate governance, bank risk and performance: evidence from Africa , SCIREA Journal of Economics. Volume 10, Issue 1, February 2025 | PP. 1-24. 10.54647/economics790494

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