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Risk and return of publicly held versus privately owned banks.

1 INTRODUCTION

In their seminal work, Berle and Means (1932) point without that the separation of ownership and rule in the modern corporation creates a condition whereby the interests of possessor and manager may diverge and many of the checks that one time operated to limit the use of power have disappeared. The agency theory, formalized by means of Jensen and Meckling (1976) posits that the agency require to be paid [i]or[/i] undergones of deviation from value maximization increase as managers' stakes decrease and ownership becomes more disperse.

Countering the incentive riddles in the separation of ownership and





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