Banking on Women Leaders: A Case for More?

IMF Working Papers, September 7, 2017

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Banking on Women Leaders: A Case for More?

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Bibliographic details

• Authors: Ratna Sahay, Martin Cihak, Papa M N'Diaye, Adolfo Barajas, Annette J Kyobe, Srobona Mitra, Reza Yousefi
• Published: September 7, 2017
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781484318164.001

Summary

• Using a new dataset, the study measures the gap between the representation of men and women in leadership positions in banks and bank supervision agencies worldwide.
• Women occupied less than 2 percent of bank CEOs positions.
• Women occupied less than 20 percent of the board seats in more than 80 percent of the observations across banks over time.
• Many low- and middle-income countries have a higher share of women in bank boards and banking supervision agency boards compared to advanced economies.
• The presence of women and a higher share of women on bank boards is associated with greater bank stability, as represented by higher z-scores and lower nonperforming loan ratios.
• The share of women on boards of banking supervision agencies is also associated with greater bank stability.
• Further research is needed to identify mechanisms through which these stability benefits are achieved and to understand conditions that facilitated entry of women into leadership roles in banks and supervision agencies.

Key Findings (empirical and descriptive)

• Representation:
  • Women occupied less than 2 percent of bank CEOs positions.
  • Women occupied less than 20 percent of the board seats in more than 80 percent of the observations across banks over time.
• Cross-country pattern:
  • Contrary to common perceptions, many low- and middle-income countries have a higher share of women in bank boards and banking supervision agency boards compared to advanced economies.

Econometric Results

• Controlling for relevant bank and country-specific factors, the analysis finds:
  • The presence of women on bank boards is associated with greater bank stability.
  • A higher share of women on bank boards is associated with greater bank stability.
  • Greater bank stability is represented in the analysis by higher z-scores and lower nonperforming loan ratios.
• The share of women on boards of banking supervision agencies is also found to be associated with greater bank stability.

Policy Implications and Research Directions

• Implication:
  • Increasing female representation in bank leadership and on banking supervision agency boards is associated with indicators of greater bank stability.
• Recommended further research:
  • Identify specific mechanisms through which stability benefits from female representation are achieved.
  • Understand the conditions that have facilitated entry of women into leadership roles in banks and supervision agencies.

Content in this bundle

• Banking on Women Leaders: A Case for More?, WP/17/199, September 2017
  • Banking on Women Leaders: A Case for More?, WP/17/199, September 2017 (Markdown version)
  • Banking on Women Leaders: A Case for More?, WP/17/199, September 2017 (PDF)