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An Examination of the Impact of the Garn-St. Germain Depository Institutions Act of 1982 on Commercial Banks and Savings and Loans

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  • Millon-Cornett, Marcia H
  • Tehranian, Hassan

Abstract

This paper evaluates the effects of events leading to the passage of the Garn-St. Germain Depository Institutions Act of 1982. The evidence suggests that the call for reform by President Reagan's Housing Commission and the Senate passage of the bill produced positive abnormal returns to stockholders of large savings and loans and commercial banks. Stockholders of small S&Ls and banks, on the other hand, generally experienced negative abnormal returns. Furthermore, when hopes of passage of the act faded, significant negative (positive) abnormal returns were experienced by stockholders of large (small) S&Ls and banks. Copyright 1990 by American Finance Association.

Suggested Citation

  • Millon-Cornett, Marcia H & Tehranian, Hassan, 1990. " An Examination of the Impact of the Garn-St. Germain Depository Institutions Act of 1982 on Commercial Banks and Savings and Loans," Journal of Finance, American Finance Association, vol. 45(1), pages 95-111, March.
  • Handle: RePEc:bla:jfinan:v:45:y:1990:i:1:p:95-111
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    9. Atul Gupta & Bently Lalatendu Misra, 2007. "Deal size, bid premium, and gains in bank mergers: The impact of managerial motivations," Working Papers 0004, College of Business, University of Texas at San Antonio.
    10. David A. Carter & Daniel A. Rogers & Betty J. Simkins & Stephen D. Treanor, 2013. "Does hedging reduce economic exposure? Hurricanes, jet fuel prices and airlines," Chapters,in: Handbook of Research Methods and Applications in Empirical Finance, chapter 14, pages 341-354 Edward Elgar Publishing.
    11. Fung, Simon Y.K. & Gul, Ferdinand A. & Radhakrishnan, Suresh, 2015. "Corporate political connections and the 2008 Malaysian election," Accounting, Organizations and Society, Elsevier, vol. 43(C), pages 67-86.
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