Bank ties and firm performance in Japan : some evidence since FY2002
McGuire, Patrick (Author)

URLURL - Presentation file, Visit http://www.bis.org/publ/work272.pdf This link opens in a new window

Since the mid-1990s, major Japanese banks have sold off a significant portion of their holdings of corporate equity. Using information on the identity of Japanese firms' top 10 shareholders, this paper explores the process of banks' equity disposal. There is some evidence that, after FY2001, banks' sales of equity accelerated, even holdings in firms for which the bank served as the main bank. However, affiliation with a main bank - proxied by firm-bank loan and shareholding ties - continues to be negatively associated with firm performance through FY2004. Regression estimates suggest that firms with strong bank ties are less profitable, face higher interest payments, and yet do not seem to enjoy lower stock price volatility than other firms. These effects are strongest for firms with a history of outside financing options, consistent with earlier arguments that the benefits of main bank relationships accrue to the banks themselves

Keywords:Japonska, bančništvo, centralne banke, bančno poslovanje, podjetje, poslovanje podjetja, uspešnost poslovanja, 2002, Japan, banking, central banks, banking management, enterprises, company performance, business efficiency, 2002
Work type:Not categorized (r6)
Organization:EF - Faculty of Economics
Publisher:Bank for International Settlements, Monetary and Economic Department
Number of pages:V, 43 str.
COBISS.SI-ID:18466022 This link opens in a new window
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