We test whether the gains from hiring an outside manager exceed the principal-agent costs of owner-manager separation at 266 small, closely held U.S. commercial banks. Our results suggest that hiring an outside manager can improve a bank's profit efficiency, but that these gains depend on...

Small closely held corporations cannot rely on market forces or outside monitors to discipline hired managers. For such firms, managerial shareholdings may be a disproportionately important tool for controlling principal-agent problems. We study a random sample of 266 small, closely held U.S....

This article provides an overview of research we have done on how different aspects of corporate governance influence bank performance. We use a random sample of state-chartered community banks in the Midwest and gather detailed information from bank examination reports on the ownership...

Recent corporate scandals, together with the effects of globalization, have led to an increasing interest in corporate governance issues. Little attention has been paid, however, to international laws and recommendations dealing with corporate governance in banking from a global perspective....

This paper documents the importance of nonbanks in retail payments in the United States and in 15 European countries and analyses the implications of the importance and multiple roles played by nonbanks on retail payment risks. Nonbanks play multiple roles along the entire payment processing...

New technologies used in payment methods can reduce risk, but they can also lead to new risks. Emerging retail payments are prone to operational and fraud risks, especially security breaches and potential use in illicit transactions. This article describes an economic framework for understanding...

Lance Davis, Richard Sylla, and John James have argued that competitive forces in U.S. banking changed in the period after 1885 and this influenced loan rates charged to bank customers. Davis's original research and others that followed largely depended on interest rates as indicators of the...