Does monitoring by the media improve the performance of government banks?

Po Hsin Ho, Hung Kun Chen, Chih-Yung Lin*, Che Wei Chi

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

3 Scopus citations

Abstract

By examining cross-country data for the period from 2000 to 2010, this study investigates whether monitoring by the media affects the performance of government-owned banks (GOBs). The results indicate that GOBs under strong monitoring do not underperform privately owned banks (POBs), whereas those under weak monitoring do underperform POBs. Further, we find that the strength of the media's monitoring has an important effect on corruption behavior and banks' performance. This result provides an important policy implication that the government should minimize its ownership, and therefore its influence, in the media sector if it intends to improve the performance of its GOBs.

Original languageEnglish
Pages (from-to)76-87
Number of pages12
JournalJournal of Financial Stability
Volume22
DOIs
StatePublished - 1 Feb 2016

Keywords

  • E61
  • G15
  • G21
  • Government banks
  • Lending corruption
  • Media monitoring
  • Operation performance

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