Browsing by Author "Fiador, V."

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Corporate Governance and Dividend Payout Policy: Evidence from Selected African Countries
(2013) Abor, J.; Fiador, V.
Purpose – This study aims to examine the effect of corporate governance on firms' dividend payout policy in sub-Saharan Africa. The study also aims to examine how dividend payout influences corporate governance. Design/methodology/approach – Using a sample made up 27 Ghanaian firms, 177 Nigerian firms, 51 Kenyan firms, and 270 South African firms covering the period 1997-2006, the paper employs a simultaneous panel regression model in its estimation. Findings – The results show that board composition and board size exhibit significantly positive relationship with dividend payout in Kenya and Ghana, respectively. Institutional ownership positively influences dividend payout among South African and Kenyan firms. In the case of Nigeria, all the corporate governance measures show significantly negative effects on dividend payout. The findings clearly suggest that, with respect to South Africa, Kenya and Ghana, good corporate governance structures lead to high-dividend payout, probably due to easy access to and low cost of external finance. However, in Nigeria, improving the governance structures may be associated with high-earnings retention or low-dividend payment in order to reduce cost of external finance. We found in the case of Ghana that, dividend payout positively affects board composition, suggesting that Ghanaian firms with high-payout tend to adopt good corporate governance structures in order to ensure protection of shareholder interest. The findings of this study certainly have important policy implications. Originality/value – This present study contributes to the corporate governance literature by looking at the importance of corporate governance in influencing firms' dividend behaviour in selected African countries.
Does corporate governance explain dividend policy in sub-saharan africa?
(2013) Abor, J.; Fiador, V.
Purpose – This study aims to examine the effect of corporate governance on firms' dividend payout policy in sub-Saharan Africa. The study also aims to examine how dividend payout influences corporate governance. Design/methodology/approach – Using a sample made up 27 Ghanaian firms, 177 Nigerian firms, 51 Kenyan firms, and 270 South African firms covering the period 1997-2006, the paper employs a simultaneous panel regression model in its estimation. Findings – The results show that board composition and board size exhibit significantly positive relationship with dividend payout in Kenya and Ghana, respectively. Institutional ownership positively influences dividend payout among South African and Kenyan firms. In the case of Nigeria, all the corporate governance measures show significantly negative effects on dividend payout. The findings clearly suggest that, with respect to South Africa, Kenya and Ghana, good corporate governance structures lead to high-dividend payout, probably due to easy access to and low cost of external finance. However, in Nigeria, improving the governance structures may be associated with high-earnings retention or low-dividend payment in order to reduce cost of external finance. We found in the case of Ghana that, dividend payout positively affects board composition, suggesting that Ghanaian firms with high-payout tend to adopt good corporate governance structures in order to ensure protection of shareholder interest. The findings of this study certainly have important policy implications. Originality/value – This present study contributes to the corporate governance literature by looking at the importance of corporate governance in influencing firms' dividend behaviour in selected African countries.
Does corporate governance explain the quality of bank loan portfolios? Evidence from an emerging economy
(Journal of Financial Economic Policy, 2020-04-17) Fiador, V.; Sarpong-Kumankoma, E.
Purpose – The purpose of this study is to assess the impact of corporate governance variables on the quality of bank loan portfolios. Design/methodology/approach – The study used a panel-corrected standard errors estimation model with the most recent 11-year data from2006 to 2016 on selected Ghanaian banks. Findings – The findings indicate that corporate governance is relevant within the banking sector and plays a key role in improving loan quality. Having a large board with the attendant pool of expertize, boards with mostly non-executive members and duality of the CEO-board chair can be harnessed to improve bank loan quality. Female participation on boards seems to detract from good performance, creating the impression of tokenism in the Ghanaian banking sector. Originality/value – The study has important implications for board construction within the banking sector and the discourse on bank asset quality. Keywords Corporate governance, Asset quality, Bank loan quality, Banking sector, Gender diversity, Non-performing loans, NPLs, Banks, Financial institutions and services, Corporate finance and governance
How Do We Explain Corporate Board Structure in Sub-Saharan Africa?
(2012) Fiador, V.; Abor, P.A.; Abor, J.
This study examines the determinants of corporate board structure in selected sub–Saharan Africa. We specifically investigate which firm–level characteristics exhibit any link whatsoever with board size, board composition and board leadership structure in Ghana, Nigeria, Kenya and South Africa. We also ascertain whether alternative governance mechanisms such as institutional shareholders and debt holders serve as substitutes in addressing the agency conflicts in firms. The findings of the study indicate that institutional ownership is an alternative governance mechanism for board size for a majority of the countries under study. The findings of this study also indicate that firm size is the only variable that significantly and positively explains board size for all the four countries under study and the other firm–level characteristics, though significant in some cases in explaining the board structure, take on different signs from country to country and for different board characteristics.
Insurance-growth nexus in Ghana: An autoregressive distributed lag boundscointegration approach
(Elsevier - Science Direct (Review of Development Finance), 2014) Alhassan, A.L.; Fiador, V.
This paper examines the long-run causal relationship between insurance penetration and economic growth in Ghana from 1990 to 2010. Usingthe autoregressive distributed lag (ARDL) bounds approach to cointegration by Pesaran et al. (1996, 2001), the study finds a long-run positiverelationship between insurance penetration and economic growth which implies that funds mobilized from insurance business have a long run impacton economic growth. A unidirectional causality was found to run from aggregate insurance penetration, life and non-life insurance penetration toeconomic growth to support the ‘supply-leading’ hypothesis. The findings have implications for insurance market development in Ghana.
Monetary policy effectiveness in Africa: the role of financial development and institutional quality
(Journal of Financial Regulation and Compliance, 2021) Fiador, V.; Sarpong-Kumankoma, E.; Karikari, N.K.
Purpose: This study aims to provide empirical evidence of the pass-through effect of monetary policy on bank lending rates vis-à-vis the potential moderating effects of financial sector development and institutional quality in Africa. Design, methodology, and approach: The study uses robust fixed effects panel data estimation techniques and data from 1990 to 2017 across 37 countries in Africa. Findings: The results show that financial development aids in the effectiveness of monetary policy transmission. A decomposition of financial development into financial institution development and financial market development shows that financial institutional development is more influential with regard to effectiveness of the interest rate pass-through compared to financial market development. This study again shows that improvements in the quality of institutions reduced lending rates in African economies. Practical implications: The findings present relevant policy implications regarding effective transmission of monetary policy by linking the pursuit of institutional quality, characterized by the control of corruption, political stability, regulatory quality, rule of law and the voice of accountability and development of financial institutions with lending rates and ultimately the demand for growth capital. Originality/value: This study contributes to the literature on the factors influencing the effectiveness of monetary policy. This study considers financial sector development and institutional quality as conduits to monetary policy effectiveness in developing African countries.