1,720,977 research outputs found
Trends in Acquirer Returns in Acquisitions of Indian Target Firms
Get PDF2019 Denman Undergraduate Research Forum Winner - First Place in Analyzing Impacts and Solutions to Capital FlowPrevious research found that both Indian acquirer and target firms earned abnormal positive stock returns around the announcement of an acquisition. This work will explore up-to-date changes in shareholder value creation around acquisition announcement, as measured by cumulative abnormal stock returns, for acquirers of Indian firms over time. Subgroups within the data sample will also be compared. A sample of fifty-five acquisitions of Indian target firms purchased by public acquirers with announcement dates ranging from 2000 to 2018 was analyzed using event study methodology. For each acquirer in the sample, daily abnormal stock returns were aggregated to produce cumulative abnormal stock return (CAR) values over fourteen-day (ten days prior to three days post announcement date) and three-day (one day prior to one day post announcement date) event periods. Average fourteen-day and three-day CAR values were negative for the full sample, and averages were significantly different over time and between subgroups. Regression analysis was then used to examine changes in CAR values over time in more depth for the full sample and six subgroups of acquirers: domestic, cross-border, acquirers of private Indian firms, acquirers of public Indian firms, small, and large. Results showed that abnormal stock returns around acquisition announcement date are trending toward zero for acquirers of Indian target firms, which is more consistent with results expected in developed markets. Additionally, return trends vary greatly between different groups of acquirers, with average pre-2008 CAR values serving as a predictor of trends over time.No embargoAcademic Major: Financ
Catch, Restrict, and Release: The Real Story of Bank Bailouts
No full textBank bailouts are not "one-shot” events, as often portrayed, but rather dynamic processes with phases over time. Regulators “catch” financially distressed banks and provide aid, “restrict” these banks’ activities for ex ante unknown lengths of time, and then “release” the banks from the restrictions when capital ratios reach sufficiently healthy levels. This catch-restrict-release bailout approach is employed globally and applies to both major bailout methods capital injections (CIs) and debt guarantees (DGs). We model how a regulator that maximizes a social welfare function that includes the value of the bank and expected costs to the rest of the financial system and the real economy of its default might design and implement catch-restrict-release and test model predictions. Our data laboratory includes multiple EU nations over the financially stressful 2008-2014 period when many bailouts occurred. Findings suggest regulators bail out banks in a qualitatively consistent fashion with maximizing the social welfare function, yielding policy implications and directions for future research
Essays on banking
Get PDFThesis (Ph. D.)--Massachusetts Institute of Technology, Sloan School of Management, February 2006.Includes bibliographical references.This thesis consists of two chapters that investigate two important issues in banking of the past decade: the effect of banking consolidation on the borrowers and the regulatory capital requirements for banks. The first chapter analyzes the effect of bank mergers on loan prices, and the welfare implications for borrowers. In particular I test the hypothesis that mergers create efficiency gains which are, in fact, passed on to borrowers through a reduction in interest rates. The alternative hypothesis is that mergers lead to greater market concentration and in turn an increase in the cost of capital for borrowers. Using a proprietary loan-level data set for U.S. commercial banks, I find that acquiring banks, on average, reduce the spreads on their new commercial and industrial loans after a merger. The reduction in loan spreads is both larger and also more persistent for the smaller acquirers, with total gross assets less than $10 billion. These findings seem to be driven by cost efficiencies due to mergers, since the results are stronger for the sample of acquirers with larger than median declines in their operating costs after their mergers. Moreover, the reduction in spreads is much larger if the acquirer and the target have some geographical overlap of markets before the merger, and, consequently, more potential for cost savings.(cont.) However, if the market overlap is so extensive as to significantly increase market concentration, market power effects dominate and loan spreads, on average increase. The findings are robust to using variation in dates of intrastate banking deregulation as an exogenous instrument for the timing of the in-market mergers. Contrary to what might be expected, bigger acquirers do not impose less favorable pricing terms for small businesses seeking to borrow. Indeed, the reduction in spreads is significant for small loans, showing that small borrowers typically pay lower interest rates to banks that have expanded during the previous few years through mergers. The second chapter models the incentives of banks to undertake "Regulatory Capital Arbitrage" (RCA), under the current capital adequacy rules. RCA is a substitution of high-risk assets for low-risk assets with no requirement to increase their risk-based regulatory capital. I show that in equilibrium banks making risky investments pool with the banks investing safely so that they can be subject to a lower amount of regulatory capital because the risk exposures of banks cannot be precisely measured. The chapter examines whether the proposed "Basel II" regulatory system would be more or less efficient and effective than the current system.(cont.) Under the Basel II rules, banks will have an option to use their own internal risk assessment systems in determining their regulatory capital as long as they satisfy infrastructure requirements of the supervisors. I show that this Internal Ratings-based (IRB) Approach of Basel II can be interpreted as a way of forcing a separating equilibrium, in which good banks that do not pursue unduly risky strategies identify themselves to the regulators and are rewarded with a lower capital requirement. Such a separating equilibrium can only be sustained under an effective supervision system or by giving some incentives to the excessively risk-taking banks to stay in the current system rather than opting into the new IRB approach.by Isil Erel.Ph.D
The Effect of Bank Mergers on Loan Prices: Evidence from the U.S.
No full textBank mergers will increase or decrease loan spreads, depending on whether the increased market power outweighs gains in operating efficiency. Using a proprietary loan-level data set for U.S. commercial banks, I find that, on average, mergers reduce loan spreads, and that the reduction is greater for acquirers with larger declines in operating costs post merger. Market overlap between the acquirer and the target leads to more potential for cost savings, which push spreads down. However, if the overlap is significant, the enhanced market power dominates the cost savings and, therefore, spreads increase. The findings are robust to using variation in dates of intrastate banking deregulation as an exogenous instrument for the timing of the in-market mergers. Furthermore, contrary to what might be expected, bigger acquirers do not impose less favorable terms on small businesses. Indeed, the average reduction in spreads is significant for small loans, showing that small borrowers typically pay lower interest rates to banks that have expanded during the previous few years through mergers.
Going Beyond Counting First Authors in Author Co-citation Analysis
Get PDFThe present study examines one of the fundamental aspects of author co-citation analysis (ACA) - the way co-citation
counts are defined. Co-citation counting provides the data on which all subsequent statistical analyses and mappings
are based, and we compare ACA results based on two different types of co-citation counting - the traditional type that
only counts the first one among a cited work's authors on the one hand and a non-traditional type that takes into
account the first 5 authors of a cited work on the other hand. Results indicate that the picture produced through this non-traditional author co-citation counting contains more coherent author groups and is therefore considerably clearer. However, this picture represents fewer specialties in the research field being studied than that produced through the traditional first-author co-citation counting when the same number of top-ranked authors is selected and analyzed. Reasons for these effects are discussed
Variations on the Author
Get PDF“Variations on the Author” discusses two of Eduardo Coutinho’s recent films (Um Dia na Vida, from 2010, and Últimas Conversas, posthumously released in 2015) and their contribution to the general question of documentary authorship. The director’s filmography is characterized by a consistent yet self-effacing form of authorial self-inscription: Coutinho often features as an interviewer that rather than express opinions propels discourses; an interviewer that is good at listening. This mode of self-inscription characterizes him as an author who is not expressive but who is nonetheless markedly present on the screen. In Um Dia na Vida, however, Coutinho is completely absent form the image, while Últimas Conversas, on the contrary, includes a confessional prologue that moves the director from the margins to the center of his films. This article examines the ways in which these works stand out in the filmography of a director who offers new insights into the notion of cinematic authorship
Appropriate Similarity Measures for Author Cocitation Analysis
Get PDFWe provide a number of new insights into the methodological discussion about author cocitation analysis. We first argue that the use of the Pearson correlation for measuring the similarity between authors’ cocitation profiles is not very satisfactory. We then discuss what kind of similarity measures may be used as an alternative to the Pearson correlation. We consider three similarity measures in particular. One is the well-known cosine. The other two similarity measures have not been used before in the bibliometric literature. Finally, we show by means of an example that our findings have a high practical relevance.information science;Pearson correlation;cosine;similarity measure;author cocitation analysis
Dispelling the Myths Behind First-author Citation Counts
Get PDFWe conducted a full-scale evaluative citation analysis study of scholars in the XML research field to explore just how different from each other author rankings resulting from different citation counting methods actually are, and to demonstrate the capability of emerging data and tools on the Web in supporting more realistic citation counting methods. Our results contest some common arguments for the continued
use of first-author citation counts in the evaluation of scholars, such as high correlations between author rankings by first-author citation counts and other citation
counting methods, and high costs of using more realistic citation counting methods that are not well-supported by the ISI databases. It is argued that increasingly available digital full text research papers make it possible for citation analysis studies to go beyond what the ISI databases have directly supported and to employ more
sophisticated methods
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