Risk-Taking Behavior and Management Ownership in Depository Institutions

J. OF FINANCIAL RESEARCH

Posted: 18 Mar 1997

See all articles by Thomas L. Steiner

Thomas L. Steiner

University of Dayton

Carl R. Chen

University of Dayton

Ann Marie Whyte

University of Central Florida

Abstract

We examine the relation between risk and ownership structure among depository institutions. The empirical results provide evidence that the relation between ownership by managers and various measures of depository institution risk is negative and significant suggesting that as managerial ownership increases, the level of risk-taking decreases. This finding, which supports a risk aversion hypothesis, is consistent across several risk measures. Furthermore, we document greater risk and greater risk aversion for savings institutions relative to commercial banks.

JEL Classification: G21

Suggested Citation

Steiner, Thomas L. and Chen, Carl R. and Whyte, Ann Marie, Risk-Taking Behavior and Management Ownership in Depository Institutions. J. OF FINANCIAL RESEARCH, Available at SSRN: https://ssrn.com/abstract=8192

Thomas L. Steiner (Contact Author)

University of Dayton ( email )

300 College Park
Dayton, OH 45469-2251
United States
937-229-2563 (Phone)
937-229-2477 (Fax)

Carl R. Chen

University of Dayton ( email )

300 College Park
Dayton, OH 45469-2251
United States
937-229-2418 (Phone)
937-229-2477 (Fax)

Ann Marie Whyte

University of Central Florida ( email )

4000 Central Florida Blvd
Orlando, FL 32816-1400
United States

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