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he board of directors, along withthe regulatory constraints. Our paper focuses on those governance mechanisms thatare implemented by the board, such as the replacement of managers and directorswhen a bank’s economic performance does not meet the owners’ expectations. 2Following previous work on this subject, 3 it is assumed here that internal-controlworks properly if the probability of a significant board turnover, or the dismissal of atop executive, is inversely related to the economic performance of the bank, measuredin terms of accounting rates of return. 4 We also consider a friendly mergerof banks as an intermediate control mechanism, somewhere in between the internalmechanisms and the external ones. This is so because mergers must be approved bythe governance bodies of the bank, and also because the target bank’s assets are1 Tirole (2001) has caused a stir in the field with his views on the role of stakeholders. For a recentsurvey of the literature on corporate governance see Becht et al. (2002).
2 Governance should be viewed as a system where each individual mechanism works interrelated withthe others. A comprehensive analysis of thegovernance of Spanish banks is not feasible at this point and,although we have tried to take into account most of the available public information, the final analysis islimited to a subset of mechanisms keeping the rest as given.
3 See, for example, Kaplan (1994a) and Franks et al. (2001) for non-financial firms, and Barro andBarro (1990), Blackwell et al. (1994) and Prowse (1995) for banking firms.
4 The ‘‘quality’’ of corporate governance has been also evaluated by looking at decisions adopted by theboard other than directors’ replacement, such as the level and composition of management compensation,the size of the board and the number of outsiders in it.2312 R. Crespı et al. / Journal of Banking & Finance 28 (2004) 2311–2330

Acknowledgements
We thank Øyvind Bøhren and Josep Tribo for insightful discussions. We also received
helpful comments from participants in seminars at the UAB, the 2002 Workshop
on Corporate Governance at Cambridge University and the VII LACEA
Meetings in Madrid. Two anonymous referees of this journal also provided helpful
suggestions that greatly improved the paper. Our research has been supported by the
Spanish Ministry of Science and Technology, CICYT, BEC 2001-2552-C03.
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Crespı, R., Garcıa-Cestona, M.A., 2001. Ownership and control of Spanish本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。