Title: The impact of ownership concentration on bank stability: evidence from Vietnamese commercial bank

Authors: Le Ha Diem Chi; Pham Hai Nam

Addresses: Faculty of Banking, Ho Chi Minh University of Banking (HUB), 36 Ton That Dam Street, District 1, Ho Chi Minh City, 700000, Vietnam ' Faculty of Banking, Ho Chi Minh University of Banking (HUB), 36 Ton That Dam Street, District 1, Ho Chi Minh City, 700000, Vietnam

Abstract: The paper uses data from 27 Vietnamese commercial banks from 2011 to 2021 to examine the impact of concentrated ownership on bank stability. In the research model, in addition to the ownership concentration variable, represented by the largest shareholder rate, the control variables include the bank-specific variables, the macroeconomic variables, and the variables that describe the quality of regulation and supervision by the State. The dependent variables use credit risk, and the Z-score represent calculated based on return on assets (ROA) and return on equity (ROE). By the system generalised method of moments (SGMM) estimation method, the research results show that highly concentrated ownership positively impacts bank stability. The study's findings highlight the role of ownership concentration, as an effective governance mechanism, in increasing supervision and the discipline of administrators to avoid excessive risk-taking and maintain banking stability.

Keywords: ownership concentration; bank stability; Z-score; credit risk; bank-specific; risk-taking.

DOI: 10.1504/IJMEF.2025.148278

International Journal of Monetary Economics and Finance, 2025 Vol.18 No.4, pp.245 - 259

Received: 01 Apr 2023
Accepted: 10 Aug 2023
Published online: 01 Sep 2025 *

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