Author : Hakkon Kim(Chungbuk National University)

<Abstract>

By using 96 savings banks data, we examine the relationship between savings bank’s ownership structure and dividends. Our results show that the concentration of ownership structure can increase savings bank’s dividends. In addition, results of our tests suggest that the positive relation between ownership structure and dividends is stronger in savings banks which have a higher level of available funds. However, the empirical results show that the positive relation between ownership structure and dividends is weaker in savings banks which have a higher level of outside director ratio and below 5% of BIS ratio. Although the results imply that dividends can be used as a means of owner managers’ private interests, those also can reduce the free cash flow of owner managers and agency costs.