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Capital Structure Dynamics of Listed Banks in Ghana
International Journal of Finance and Banking Research
Volume 2, Issue 5, October 2016, Pages: 167-177
Received: Jun. 20, 2016; Accepted: Jul. 12, 2016; Published: Aug. 22, 2016
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Authors
Anthony Kusi, Institute of Entrepreneurship and Enterprise Development, Kumasi Polytechnic, Kumasi, Ghana
Joseph Yensu, Institute of Entrepreneurship and Enterprise Development, Kumasi Polytechnic, Kumasi, Ghana
Kobina Eduful Aggrey, Bank of Africa Ghana Limited, Kumasi, Ghana
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Abstract
The aim of this paper is to provide a comprehensive review on Capital Structure Dynamics of Listed Banks in Ghana. The study examines the determinants of capital structure, the significance of performance on equity and leverage. Seven (7) Banks on the Ghana Stock Exchange were used for the periods 2005 to 2012 The fixed and random effect regression technique was used. The study found Asset Tangibility and Non-debt tax shield to have a positive relationship with equity. The study also discovered that, the size of a bank was a significant determinant of equity and also has a positive association with equity. There was a positive relationship between performance and equity. There was also a negative relation with Growth opportunity of a bank, Dividend policy and equity. Performance and size of a bank are the determinants of leverage. There was a statistically significant positive relation with leverage and a negative statistically significant relation with the size of a bank. The study found Leverage to have positive relationships with Asset Tangibility, Non-debt tax shield and Dividend ratio. The study also discovered a negative association between Growth Opportunity of a bank and Leverage.
Keywords
Capital Structure, Equity, Performance, Panel Data, Listed Banks, Ghana
To cite this article
Anthony Kusi, Joseph Yensu, Kobina Eduful Aggrey, Capital Structure Dynamics of Listed Banks in Ghana, International Journal of Finance and Banking Research. Vol. 2, No. 5, 2016, pp. 167-177. doi: 10.11648/j.ijfbr.20160205.12
Copyright
Copyright © 2016 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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