The Effect of Board and Ownership Structure on the Efficiency of Banks in Tunisia: The Stochastic Frontier Approach
The corporate governance problem is likely to be worse in banks due to their attributes (greater opaqueness than other industries, greater government regulation...) that weaken many traditional governance mechanisms. The purpose of this research is to explore the governance characteristics of the Tunisian listed banks and to detect the impact of the internal governance mechanisms on their efficiency during the period 2002-2009. Our findings indicate that the structure and the size of the board of directors and the ownership structures present divergent effects on the banks efficiency. Then, empirical results show that Tunisian listed banks display a middle efficiency level of 81.60% during the period 2002-2006. The deterioration of the efficiency level is owed to big public bank; in fact, private banks are more efficient than the public ones.