Study On The Relationship Between Ownership Structure And Financial Performance Of Small Loan Companies

Small loan companies since birth in the early 1970s, is widely applied in many developing countries. In the constant practice, small loan company has gradually mature. With the reform and opening in our country, more and more farmers, individual entrepreneur towards the path of self-employment, in the background, small loans company looking for the opportunity of development. Beginning in 2003, in government meetings and files repeatedly emphasize the development of rural finance, to promote all kinds of the construction of the ownership structure of micro small financial institutions; in 2008, Bank supervision edicted 《About the small loan company pilot guidance》 which in the nature of small loan companies, set up requirements, as well as the source of funding and funding to make clear a regulation; in 2009 government proposed that, in the process of construction about the rural areas of the financial system, we should further intensify the development of microfinance, realize the organization and system innovation, constantly set up modernized new rural microfinance organizations, promote small loans to the development of the underdeveloped areas in China. Based on the small loan company in Shandong province as the research object, this paper will explore the relationship between ownership structure and financial performance.In this paper, according to the theoretical analysis in the process of research-hypothesis-the empirical logic. First of all, under the background of the theory and practice, the purpose of this study is put forward, and then collect the literature at home and abroad and classify and summarize the literature about the relationship between ownership structure and performance of small loan companies; By consulting relevant literature, this paper defines the small loan companies, equity structure, financial performance respectively and illustrates the role of equity structure in the company’s financial performance; Then introduces the development of small loan companies in Shandong province, combining with the characteristics of small loans company, this paper puts forward the research hypothesis on the basis of theoretical analysis, and this paper selects interest on capital ratios as small loans company financial performance indicators, the proportion of corporate shares, natural person’s stake, the top five shareholders’ shareholding ratio as substitution variables of equity structure, builds the regression model to analyze empirically and robustness; Finally, this paper will put forward corresponding Suggestions through the empirical conclusion.In this paper, on the basis of theoretical analysis and empirical test, we can get the following conclusion:First, the nature of the shareholders will not affect small loan company’s financial performance; Second, small loan company’s financial performance and ownership concentration has the relationship as inverted U; Third, small loans company equity transfer behavior is one of factors that affect small loans of the company’s financial performance, and the behavior was beneficial to improve the small loan company’s financial performance. According to the above conclusions put forward the following Suggestions:First, raise the equity concentration to maintain petty loan company good financial performance by controlling the ownership concentration; Second, strengthen the external governance mechanism to provide a good environment for the development of small loan companies, and create a good environment for small loan companies equity circulation and improve its financial performance.