European Cooperation (May 2016)
THE INFLUENCE OF SPECIFICITY OF CORPORATE RELATIONS IN BANKS ON THE DEVELOPMENT OF CORPORATE CONFLICTS
Abstract
In this article it is reasoned that the establishment of corporate relations in the banks differs from its establishment in the non-banking institutions on the account of peculiarities in the regulation of banking services market, specificity of capital forming in banks as well as distribution of risks from ineffective investments.The peculiarities in corporate relations in the banks were generalized as follows: - another structure of interested agents with such key players as depositors (as specific creditors) and regulating bodies, broadens the "the principal-agents" conflicts in the banks and complicates its regulation; The problem of opportunistic behavior of management is more global and more complicated by the increased asymmetry of banking services market. Moreover, the market asymmetry has a bilateral character and high risk of agent (bank) irresponsibility .One of the unique characteristics of the banks is its dependence on the phenomena of "trust" factor, which can hardly be quantified or regulated, however strongly impacts the functioning of banking institutions. The problem of corporate relations and corporate conflicts in the banks goes far beyond the frames of internal problems of separate institutions due to the tight links and interdependency between the banks.Also the article emphasizes the impact of the peculiarities in bank corporate relations on the forming and development of the corporate conflicts.
