7-22

• Aggelopoulos, Eleftherios
• Zafeiropoulos, Georgios
• Spyropoulos, Vasilios

This paper investigates for the first time the determinants of shareholder value creation focusing on Greek banks over the period 2005-2009. The estimation results show that credit risk factor has a negative influence on shareholder value creation while leverage is also found to be inversely related to shareholder value creation. Other factors such as cost management, market share and diversification of income seem to not affect significantly shareholder value.

• Economics and Business

• Economics

Banking, Shareholder value, Residual income

JEL classification: M41, G21

1. Athanasoglou, P., Brissimis, S., and Delis, M., (2008). Bank specific, industry specific and macroeconomic determinants of bank profitability. Journal of International Financial Markets, Institutions and Money, 18, pp.121-136Baltagi, B., 2005. Econometric Analysis of Panel Data. 3rd Edition, John Wiley&SonsBank of Greece, June 2009. Financial Stability Report, Bank of Greece, Athens.Beccalli, E., Casu, B., and Girardone, C., (2006). Efficiency and stock performance in European banking. Journal of Business Finance and Accounting, 33, pp. 218–235Bodmer, A., (2001). Value based management fur Banken, Bern, Stuttgart and ViennaBolt, W., Tieman, A., 2004. Banking competition, risk and regulation. Scandinavian Journal of Economics, 106, pp783–804Brissimis, S., Delis, M., and Papanikolaou, N. (2008). Exploring the nexus between banking sector reform and performance: Evidence from newly acceded EU countries. Journal of Banking and Finance, 32, pp. 2674- 2683Damodaran, A., (2004). Valuing Financial Service Firms, Stern Business School, New York University, http: pages.stern.nyu.edu /~adamodar /New_Home_Page/ papersDermine, J., (2009). Bank Valuation and Value-Based Management, 1st Edition McGraw – HillFeltham, G., and Ohlson, J., (1995). Valuation and Clean Surplus Accounting for Operating and Financial Activities. Contemporary Accounting Research 11, pp. 689-731Fiordelisi, F., (2002). Shareholder Value and the Clash in Performance Measurement: Are Banks special? Working paper at the University of Wales Bangor.Fiordelisi, F., (2007). Shareholder value efficiency in European banking. Journal of Banking and Finance, 31, pp. 2151-2171.Fiordelisi, F., and Molyneux, P., (2007). Value Creation in Banking, working paper, ssrn.com/abstract=965441.Fiordelisi, F., and Molyneux P., (2010). The determinants of shareholder value in European banking. Journal of Banking and Finance, 35, pp.1189-1200Goddard, J., Molyneux, P., and Wilson, J., (2004). The profitability of European Banks: a cross sectional and dynamic panel analysis, Manchester School, 72, pp. 363-381Gross, S., (2006). Banks and Shareholder Value. An overview of Bank Valuation and Empirical Evidence on Shareholder value for Banks. 1st Edition DUV Gabler Edition Wissenschaft.Koller, T., Goedhart, M., and Wessels, D., (2005). Measuring and Managing the Value of Companies, Fourth Edition Mc Kinsey & CompanyKyriazis, D., and Anastassis, C., (2007). The validity of the Economic Value Added Approach: an Empirical Application. European Financial Management. 13 pp.71-100Lepetit, L., Nys, E., Rous, P., and Tarazi, A., (2008). Bank income structure and risk: an empirical analysis of European Banks. Journal of Banking and Finance, 32, pp. 1452-1467Miller, S., and Noulas, A., (1997). Portfolio mix and large-bank profitability in the USA. Applied Economics, 29, pp. 505-512MSDW., (2001). Valuing Financial Stocks with Residual Income, Morgan Stanley Dean Witter, Equity Research North America Salas, V., and Saurina, J., (2003). Deregulation, market power and risk behavior in Spanish Banks, European Economic Review, 47, pp. 1061-1075.Uyemura, D., Kantor, C., Pettit, J., and Stern Stewart & Co., (1996). EVA for Banks: Value creation, Risk Management and Profitability Measurement. Journal of Applied Corporate Finance, 9. pp. 94-113.