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Profits persistence and ownership: evidence from the Italian banking sector |
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| Authors: | Mariarosaria Agostino Leone Leonida Francesco Trivieri |
| Institution: | 1. Dipartimento di Economia e Statistica , Università degli Studi Della Calabria , 87036, Arcavacata di Rende, Cosenza, Italy;2. Dipartimento di Economia e Statistica , Università degli Studi Della Calabria , 87036, Arcavacata di Rende, Cosenza, Italy;3. Department of Economics and Related Studies , University of York , Heslington, York, YO10 5DD, UK |
| Abstract: | The hypothesis that ownership structure affects persistence of profits in the Italian banking industry is tested. The time-invariant components of ROA and ROE are regressed against ownership concentration and the fraction of shares held by the major shareholders. The results show that abnormal profits increase if ownership is concentrated in foundations and banks, and decrease if market forces are allowed to operate. |
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