The Empirical Research Of Bank Share-Holding And Managers’ Perks Of Companies

It has initiated the universal attention that managers of Chinese listed company use authority to seek excessive perks from all walks, and the government has also attempted to take measures to supervise and manage the excessive perks. Manager’s perks become the regulatory focus of the Commission for Discipline Inspection. Manager’s perks are born in the separation of ownership and operation, and asymmetries of information is the primary cause for forming the excessive manager’s perks. Supervision and motivation are two main methods to solve asymmetries of information, and bank share-holding can display the function of surveillance effectively. The law forbids the bank to hold shares of company to avoid risk in our country, but in the practice of reform, our country exists a lot of phenomenon that financial institutions, such as banks, hold shares of listed companies. By looking over the annual reports of A-shares listed companies in Shanghai and Shenzhen stock market, there are 1565 companies have phenomenon of bank share-holding by the end of 2012, after bank share-holding, the bank is not only a creditor, but also a shareholder, few scholars have studied the changes of corporate governance, especially manager’s perks, after the emergence of bank’s dual identities.Based on the results of the correlation researches about manager’s perk and bank share-holding in domestic and foreign, and combined the present situation of manager’s perks in Chinese listed company in recent years, this paper put forward suppositions which meets Chinese conditions, sampled by A-shares listed companies in Shanghai and Shenzhen stock market during 2005 to 2012, applying multivariate linear regression and curve regression to analyze the relations between bank share-holding and manager’s perks. The empirical results can be described as followed:(1) Bank share-holding and manager’s perks were significantly negative correlation, which indicated the bank share-holding may reduce manager’s perks in the entire A-shares listed companies;(2) In the entire sample, equity of bank shareholder and manager’s perks were remarkable negative correlation, that is to say, along with the increase of equity of bank shareholder, manager’s perks also reduces;(3) In the state-owned enterprise sample, when equity of bank shareholder increases, manager’s perks reduces unceasingly;(4)In the non-state-owned enterprise sample, the equity of bank shareholder and manager’s perk presented positive correlation, but is not remarkable.According to the empirical conclusion, relevant policy suggestions were put forward as followed: amend the business-act which allow the bank hold companies’ share, make the bank to mix operation, optimize company ownership structure and improve the equity of bank shareholder, At the same time, the government organization should strengthen the supervise of bank share-holding to reduce agency costs, improve corporate governance, and then reduce manager’s perks.