Ownership Structure and Capital Structure of Vietnam Commercial Banks

Abstract

The article evaluates the dynamic of ownership structure to commercial banks' capital structure in Vietnam from 2012 to 2020. The ownership structure is represented by two indicators: ownership ratio and state and foreign ownership ratio. Capital structure is described by three factors: financial leverage, customer deposits, and non-deposit debt. Using the Bayesian regression method via the Gibbs sampling algorithm, the research results show that first, state ownership has a negative impact on capital structure, represented by financial leverage and non-deposit liabilities; still, it has the same effect on customer deposits. Second, foreign ownership harms capital structure in all three representative variables: financial leverage, customer deposits, and non-deposit debt. From the research results, the authors recommend that bank managers establish appropriate capital and ownership structures to ensure safe, efficient, and sustainable banking operations.