David Kershaw, Professor of Law at the London School of Economics, and Thomas Kirchmaier, Fellow of the Financial Markets Group at the London School of Economics and Lecturer in Business Economics and Strategy at the Manchester Business School, presented as a part of the IMFS Working Lunch series their study "Shareholder Empowerment and Bank Bailouts".
Their research was - from a legal as well as from an economic point of view - focused on the question, if shareholder empowerment affected bank performance during the crisis. Their parameter was the bank bailouts during the years 2003 until 2009, to illustrate this they used a six-scores "Management Insulation Index". The conclusion was, that in banks, where the shareholders have less influence on the board of managers, the probability of a bailout decreases by around 20%. Other governance variables failed to produce significant results.
At the end of the lecture followed a lifely discussion, which created supplied new channels for further investigation.
The presentation can be downloaded here.
Please find the link to the study here.
Ferreira, Daniel, Kershaw, David, Kirchmaier, Tom and Schuster, Edmund-Philipp, Shareholder Empowerment and Bank Bailouts (November 2, 2012). ECGI - Finance Working Paper No. 345/2013