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Payout policy and ownership structure: The Case of Islamic and Conventional Banks. / Duqi, Andi ; Jaafar, Aziz; Warsame, Mohammed H.

Yn: British Accounting Review, Cyfrol 52, Rhif 1, 01.2020.

Allbwn ymchwil: Cyfraniad at gyfnodolynErthygl

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Duqi, Andi ; Jaafar, Aziz ; Warsame, Mohammed H. / Payout policy and ownership structure: The Case of Islamic and Conventional Banks. Yn: British Accounting Review. 2020 ; Cyfrol 52, Rhif 1.

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TY - JOUR

T1 - Payout policy and ownership structure: The Case of Islamic and Conventional Banks

AU - Duqi, Andi

AU - Jaafar, Aziz

AU - Warsame, Mohammed H.

PY - 2020/1

Y1 - 2020/1

N2 - Using a sample of Islamic and conventional financial institutions domiciled in 16 countries for the period 2000-2015, we examine how ownership structure affects dividend policy. Our main findings indicate that ownership identity is important in explaining dividend policy in these banks, albeit in different patterns. In particular, the results suggest that government ownership seems to exert negative effects on dividend payouts in both types of banks, which is in line with the preference of governments towards bank stability. With respect to family ownership, the impact is negative for conventional banks but positive for Islamic ones, consistent with agency theory. These results are to some extent similar in the case of foreign ownership where it is associated with a higher payout policy in Islamic banks, but not significant in conventional ones. Our results are robust to an array of additional analyses including propensity score matching.

AB - Using a sample of Islamic and conventional financial institutions domiciled in 16 countries for the period 2000-2015, we examine how ownership structure affects dividend policy. Our main findings indicate that ownership identity is important in explaining dividend policy in these banks, albeit in different patterns. In particular, the results suggest that government ownership seems to exert negative effects on dividend payouts in both types of banks, which is in line with the preference of governments towards bank stability. With respect to family ownership, the impact is negative for conventional banks but positive for Islamic ones, consistent with agency theory. These results are to some extent similar in the case of foreign ownership where it is associated with a higher payout policy in Islamic banks, but not significant in conventional ones. Our results are robust to an array of additional analyses including propensity score matching.

KW - Agency theory

KW - Islamic banking

KW - Ownership structure

KW - payout policy

U2 - 10.1016/j.bar.2019.03.001

DO - 10.1016/j.bar.2019.03.001

M3 - Article

VL - 52

JO - British Accounting Review

JF - British Accounting Review

SN - 0890-8389

IS - 1

ER -