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Managerial Cost Inefficiency and Takeovers of U.S. Thrifts

Author

Listed:
  • Fatma Cebenoyan

    (Hunter College-CUNY, U.S.A.)

  • A. Sinan Cebenoyan

    (Hofstra University, U.S.A.)

  • Elizabeth S. Cooperman

    (University of Colorado at Denver, U.S.A.)

Abstract

This paper uses a two-step methodology to examine the relationship between managerial cost inefficiency and the takeover of U.S. thrifts during a period of market liberalization and widespread takeover activity, 1994 to 2000. In the first stage using stochastic cost frontiers, controllable managerial cost inefficiency scores are estimated for all stock firms operating each year in 1994 to 2000. In a second stage, these scores are used to examine correlates of takeovers, focusing on cost inefficiency. For takeovers by banks, a significant negative relationship between cost inefficiency and takeover is found, suggesting an exit of more cost efficient firms from the thrift industry during this period. However, takeovers by thrifts are associated with other characteristics

Suggested Citation

  • Fatma Cebenoyan & A. Sinan Cebenoyan & Elizabeth S. Cooperman, 2005. "Managerial Cost Inefficiency and Takeovers of U.S. Thrifts," Multinational Finance Journal, Multinational Finance Journal, vol. 9(1-2), pages 23-42, March-Jun.
    • Handle: RePEc:mfj:journl:v:9:y:2005:i:1-2:p:23-42
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    References listed on IDEAS

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    Cited by:

    1. Fatma Cebenoyan & A. Sinan Cebenoyan & Elizabeth S. Cooperman, 2003. "Regulatory Regimes and Takeovers of U.S. Thrifts," Economics Working Paper Archive at Hunter College 303, Hunter College Department of Economics.

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    More about this item

    Keywords

    depository institutions; thrifts; takeovers and cost inefficiency; Click here to download the full article;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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