Research On Shareholder Structure And Corporate Performance Of Listed Firms From The Financial Sector

The relationship between corporate performance and shareholding structure is a very important research topic in corporate finance. The studies analyzing the relationship have important impacts on the optimization of our corporate structure and improving the company’s performance. Since China’s accession to WTO, China committed that in 2005 China would fully open China’s financial industry. Since that, China’s financial industry has experienced rapid development, and occupied an important position in the national economy. With the acceleration of the process of financial markets, chances and challenges are existed in China’s financial industry, which means that financial sector reformation is imperative. In the process of financial sector reformation, it is important to build a reasonable ownership structure in order to facilitate the performance of the financial industry. Many scholars have conducted researches based on ownership structure and corporate performance, but there were few studies focuses on the financial corporates.This paper uses our financial listed companies as the research samples to empirically studying the relationship of the financial institution ownership structure and performance. This paper starts from the theory the ownership structure and corporate governance, combined with unique characteristics of financial listed companies, to make theoretical basis for the empirical research. In the empirical part, the paper selects 39 financial institutions listed on the board since 2011, and uses panel data from 2011 to 2013 of the research samples and makes 1266 non-financial listed companies as a comparison sample. The paper uses a fixed effects model (FEM), in which, concentrated equity index, equity checks and balances index, separation of ownership are the explanatory variables to measure the ownership structure; earnings per share, total cash than debt, net sales margin and Fixed Assets profit are the dependent variables to measure corporate performance; asset size and asset-liability ratio are control variables. Empirical research is divided into three steps:firstly, using descriptive statistics analysis to exam differences in financial listed companies and non-financial listed companies in terms of company performance and ownership structure or the like; Secondly, using partial correlation analysis, in the case of the other control variables, to make linear analysis of the company’s performance and ownership structure, in order to find whether there is a correlation and what is the correlation; Thirdly, on the basis of the partial correlation analysis, the paper uses multiple linear regression analysis on the selected sample, to further exam the effect of ownership structure on the financial performance of listed companies. The conclusions as follows:(1) There is an inverted U relationship between concentration of ownership and performance of the financial listed companies. When the ratio of the largest shareholder is about 37.14%, the company is to achieve the best performance; (2) There is a positive correlation between the degree of equity restriction and financial companies’ finance indicators for those listed in Shanghai and Shenzhen stock exchange. When the second largest shareholder stake is relatively large, he is able to have some checks and balances on the largest shareholder; (3) Separation of controlling and ownership of listed financial companies have positive correlation with the companies’ performance. Separation of controlling and ownership enables the enterprise resources and enterprise management personnel to achieve the best combination to maximize the benefits for the owner to bring greater benefits.The innovation of this paper is followed:It studies the financial corporates, as previous studies eliminated financial companies. This paper uses the listed financial corporates as samples, and compares with all other listed companies, demonstrating the unique of financial listed companies, and getting a separate conclusions applicable to the financial company, which corroborates previous studies’reason of eliminating the financial companies.