How do employee stock ownership plans programs and ownership structure affect bank performance? Evidence from Vietnam

This study analyzes how employee stock ownership plans (ESOPs) and ownership structure affect bank performance. The study employs the generalized method of moments to examine data from 39 Vietnamese commercial banks from 2009 to 2020. The findings indicate that banks with ESOP improve ROA by 57% more than banks without ESOP. However, a percentage increase in state and domestic ownership reduces the ROA by 0.7% and 0.4%, respectively. The study has important implications for governments and regulators. While the findings do not support the cherry-picking and free-rider theories, they align with agency theory and prior literature.