Bankers on the Supervisory Board of German firms: the impact on firms' performance in the Global Financial Crisis

In this Master Thesis, I analyze and document the influence German banks exercise on the performance of German firms, during the global financial crisis, from 2007 to 2009. I find evidence that banks act as financial and capital market experts, helping firms to obtain easier access to finance in a period of reduced liquidity. However, such financial and capital market expertise does not seem to provide great benefits for those firms, which exhibit systematic lower levels of performance than non-bank influenced firms. This findings show evidence that banks do not perform a monitoring role consistent with their status of lenders or large shareholders, but instead, use their representation on boards of German firms to promote their own business, in a manner which seems to be not aligned with the interests of the firms and shareholders.