The impact of Japan's financial stabilization laws on bank equity values
Abstract
In the fall of 1998, two important financial regulatory reform acts were passed in Japan. The first of these acts, the Financial Recovery Act, created a bridge bank scheme and provided funds for the resolution of failed banks. The second act, the Rapid Revitalization Act, provided funds for the assistance of troubled banks. While both of these acts provided some government assistance to the banking sector, they also called for reforms aimed at strengthening the regulatory environment. ; Using an event study framework, this paper examines the evidence in equity markets concerning the anticipated impact of the regulatory reforms. Our evidence suggests that the Financial Recovery Act was expected to hurt large banks, while the anticipated impact of the act by financial strength was mixed. In contrast, the anticipated impact of the Rapid Revitalization Act was expected to be unambiguously anti-reform, as news favorable to its passage disproportionately favored large and weak Japanese banks.(This abstract was borrowed from another version of this item.)
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Bibliographic Info
Article provided by Elsevier in its journal Journal of the Japanese and International Economies.
Volume (Year): 17 (2003)
Issue (Month): 3 (September)
Pages: 263-282
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Web page: http://www.elsevier.com/locate/inca/622903
Related research
Keywords:Other versions of this item:
- Mark M. Spiegel & Nobuyoshi Yamori, 2002. "The impact of Japan’s financial stabilization laws on bank equity values," Proceedings, Federal Reserve Bank of San Francisco, issue Sep.
References
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Takeshi Kobayashi & Mark Spiegel & Nobuyoshi Yamori, 2006.
"Quantitative easing and Japanese bank equity values,"
Working Paper Series
2006-19, Federal Reserve Bank of San Francisco.
- Kobayashi, Takeshi & Spiegel, Mark M. & Yamori, Nobuyoshi, 2006. "Quantitative easing and Japanese bank equity values," Journal of the Japanese and International Economies, Elsevier, vol. 20(4), pages 699-721, December.
- Smith, David C., 2003. "Loans to Japanese borrowers," Journal of the Japanese and International Economies, Elsevier, vol. 17(3), pages 283-304, September.
- David C. Smith, 2002. "Loans to Japanese borrowers," Pacific Basin Working Paper Series 02-11, Federal Reserve Bank of San Francisco.
- Kimie Harada & Takatoshi Ito & Shuhei Takahashi, 2010. "Is the Distance to Default a Good Measure in Predicting Bank Failures? Case Studies," NBER Working Papers 16182, National Bureau of Economic Research, Inc.
- Masami Imai, 2006. "The Emergence of Market Monitoring in Japanese Banks: Evidence from the Subordinated Debt Market," Wesleyan Economics Working Papers 2006-008, Wesleyan University, Department of Economics.
- Shimizu, Katsutoshi, 2006. "How can we effectively resolve the financial crisis: Empirical evidence on the bank rehabilitation plan of the Japanese government," Pacific-Basin Finance Journal, Elsevier, vol. 14(2), pages 119-134, April.
- David C. Smith, 2003. "Loans to Japanese borrowers," International Finance Discussion Papers 769, Board of Governors of the Federal Reserve System (U.S.).
- Imai, Masami, 2007. "The emergence of market monitoring in Japanese banks: Evidence from the subordinated debt market," Journal of Banking & Finance, Elsevier, vol. 31(5), pages 1441-1460, May.
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