Information externalities of seasoned equity issues: differences between banks and industrial firms

Article Abstract:

The confidential information system of bank lending and bank management techniques led the financial market to look upon individual bank common stock issuance announcements as dubious indications of worth for other mercantile banking houses. No such outcome was observed when industrial establishments publicized equity issues, because the only information delivered on such occasions was related to the company. The legal controls applied on mercantile banking houses to raise equity had the opposite effect on market prices in the banking industry.

Laws, regulations and rules, Influence, Statistics, Securities, Bank stocks

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A comparison of the information conveyed by equity carve-outs, spin-offs, and asset sell-offs

Article Abstract:

The effects of different kinds of corporate restructuring on share prices are discussed. The creation of a carve-out subsidiary which involves initial public offering is shown to give rise to a negative price effect. On the other hand, the establishment of a spin-off subsidiary produces a positive price reaction while an asset sell-off does not generate a significant response in either direction. The last restructuring category does not entail initial public offerings of stocks.

Economic aspects, Prices and rates, Stocks, Stock prices, Corporate reorganizations

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An analysis of contagion and competitive effects at commercial banks

Article Abstract:

The extent to which a negative event occurring at a specific bank generates externalities for the banking system is examined, and the question of whether the population of commercial banks should be seen as homogeneous is addressed. Dividend reductions are negative events for money center and regional banks, but only reductions at money center banks have negative, contagion-type externalities.

Research

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