2018/01/01 by Christopher L. Colvin · 18 citations
Business, Management and Accounting · Economics, Econometrics and Finance · #Accounting #Banking stability, regulation, efficiency #Business #Capital (architecture) #Corporate Finance and Governance #Corporate governance #Economics #Finance #Financial crisis #Financial distress #Financial system #Historical Economic and Social Studies #Liability #Limited liability #Psychological resilience #Resilience (materials science) #Shareholder
paper · open access · doi:10.1017/s0007680519000011
published in The Business History Review 92(4), 661-690 (Cambridge University Press)
openalex publication_date 2018/01/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/05/21
By the start of the twentieth century, the two organizational forms most used by Dutch banks to raise capital through the dispersal of their ownership were the cooperative association and the public company. Share ownership in cooperatives was typically restricted to customers, while companies permitted outside investors. Neither organizational form dictated specific shareholder liability arrangements. New specialist banks targeting small and medium-sized enterprises (SMEs) combined these two organizational forms and flexible liability rules to create hybrid forms. I find those that took the public company form were more likely to suffer distress during the Dutch financial crisis of the 1920s. Liability arrangements for shareholders, by contrast, had a negligible impact on these banks’ resilience.