The performance variables are not statistically significant for the board and chairman change
mechanisms, i. e., they do not exercise any influence over the probability of board or chairman
change. Thus, internal governance mechanisms activity is not related to ACC economic
performance, which proves that these kinds of governance interventions are not linked to the
ACC performance, confirming the weakness of the ACCs internal control mechanisms. These
results are comparable to the ones of Prowse (1997) who finds some substitution between
regulation and other governance mechanisms in banks. Gorton and Schmid (1999) argue that only
mergers and proxy contests are feasible for cooperative banks as control changes. Crespi et. al.
(2004), for the Spanish banks, only observe a negative association between governance activity
and economic performance in saving banks that merge, evidence of their weak internal
governance mechanism.
Furthermore, Anderson and Campbell (2000), on the other hand, explain the lack of a
relationship between executive change and the performance of Japanese banks as evidence of the
banking sector's inefficiencies. And Blackwell et al. (1994) find a negative relation between
accounting profitability and management turnover in the subsidiaries of Texas' multibank
holdings.
Let’s focus our analysis on the external governance mechanisms and the performance
variables. In the management of credit risks, bad loans ratio (X1) affects positively the probability
of an intervention by a central ACC nomination agent, or a management board replacement, and
the probability of an ACC participation in a merger operation.
Regarding the operational costs, labour costs (X2) do not prove to have a significant effect on
the probability of an ACC experiencing a central ACC intervention or being involved in a
merger. The explanation for this lack of influence of the labour costs variable on the probability
of an ACC experiencing a central ACC intervention or being involved in a merger can be
11
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