What's Banking Sector Concentration Got to Do with Private Equity Market?
AbstractThe paper investigates the link between bank concentration and a country's buyout market. We perform a macro level analysis for 15 European countries during 1997-2007. We estimate the elasticity of the country i's buyout market to country i's concentration in the banking sector. Our major finding suggests that the more concentrated the banking sector is, the better it is for the size of the buyout market. The elasticity ranges from 1 up to 3 percent depending on which bank concentration measure is employed and what segment of buyout market we look at. We also find that bank concentration is irrelevant for the average deal size. To the best of our knowledge, this is the first paper to analyze the link between banking sector developments and the market for leveraged buyouts.
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Bibliographic InfoPaper provided by DIW Berlin, German Institute for Economic Research in its series Working Paper / FINESS with number 3.4.
Length: 24 p.
Date of creation: 2009
Date of revision:
Private equity financing; corporate finance; banking concentration; market power; banking competition;
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- G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
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- Syden Mishi & Asrat Tsegaye, 2012. "The Role of Banks in Monetary Policy Transmission in South Africa," Working Papers 295, Economic Research Southern Africa.
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