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A Note on Shareholder Oversight and the Regulatory Environment: The Japanese Banking Experience

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Author Info
Kim, Kenneth A.
Rhee, S. Ghon
Abstract

During a period where Japanese banks operated under a less restrictive regulatory environment, 1986-88, we find positive relationships between bank risk and ownership concentration. This empirical evidence reveals shareholder activism by the largest shareholders. During the periods immediately before and immediately after this particular subperiod, which are characterized by stricter regulatory environments, we do not observe evidence of shareholder activism. Taken together, these results are consistent with the argument that restrictive regulation and shareholder oversight are substitutes for one another. Time-series results and bank performance results yield consistent evidence.

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File URL: http://hermes-ir.lib.hit-u.ac.jp/rs/bitstream/10086/13955/1/wp2000-2a.pdf
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Publisher Info
Paper provided by Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University in its series CEI Working Paper Series with number 2000-2.

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Length: 32 p.
Date of creation: Jan 2000
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Handle: RePEc:hit:hitcei:2000-2

Note: Current Draft: January 2000
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Related research
Keywords: Large shareholders; Japanese banks; bank risk; shareholder oversight;

Find related papers by JEL classification:
G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Mortgages
G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Capital and Ownership Structure

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    Other versions:
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    Other versions:
  14. Agrawal, Anup & Mandelker, Gershon N., 1990. "Large Shareholders and the Monitoring of Managers: The Case of Antitakeover Charter Amendments," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 25(02), pages 143-161, June. [Downloadable!]
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