The effects of bank regulation stringency on seasoned equity offering announcements

We study the relation between bank regulation stringency and announcement effects of seasoned equity offerings across 21 countries. Under a low to moderate bank regulation environment, the market reacts more positively to the bank SEO announcements for an increase in the level of bank regulation. Ho...

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Main Authors:	Hui Li, Hong Liu, Chris Veld
Format:	Default Article
Published:	2018
Subjects:	Bank regulation Seasoned equity offerings Moral hazard Involuntary issuance
Online Access:	https://hdl.handle.net/2134/11800953.v1
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id	rr-article-11800953
record_format	Figshare
spelling	rr-article-118009532018-11-03T00:00:00Z The effects of bank regulation stringency on seasoned equity offering announcements Hui Li (32376) Hong Liu (6268211) Chris Veld (8399202) Bank regulation Seasoned equity offerings Moral hazard Involuntary issuance We study the relation between bank regulation stringency and announcement effects of seasoned equity offerings across 21 countries. Under a low to moderate bank regulation environment, the market reacts more positively to the bank SEO announcements for an increase in the level of bank regulation. However, the bank SEO announcement effects become more negative if the bank regulation becomes too stringent. This inverted U-shaped relation is robust after we use the exogenous cross-country and cross-year variation in the timing of the Basel II adoption as an instrument to assess the causal impact of bank regulation on SEO announcement effects. Bank regulation has no significant impact of SEO announcement effects if the equity offering is involuntary. 2018-11-03T00:00:00Z Text Journal contribution 2134/11800953.v1 https://figshare.com/articles/journal_contribution/The_effects_of_bank_regulation_stringency_on_seasoned_equity_offering_announcements/11800953 CC BY-NC-ND 4.0
institution	Loughborough University
collection	Figshare
topic	Bank regulation Seasoned equity offerings Moral hazard Involuntary issuance
spellingShingle	Bank regulation Seasoned equity offerings Moral hazard Involuntary issuance Hui Li Hong Liu Chris Veld The effects of bank regulation stringency on seasoned equity offering announcements
description	We study the relation between bank regulation stringency and announcement effects of seasoned equity offerings across 21 countries. Under a low to moderate bank regulation environment, the market reacts more positively to the bank SEO announcements for an increase in the level of bank regulation. However, the bank SEO announcement effects become more negative if the bank regulation becomes too stringent. This inverted U-shaped relation is robust after we use the exogenous cross-country and cross-year variation in the timing of the Basel II adoption as an instrument to assess the causal impact of bank regulation on SEO announcement effects. Bank regulation has no significant impact of SEO announcement effects if the equity offering is involuntary.
format	Default Article
author	Hui Li Hong Liu Chris Veld
author_facet	Hui Li Hong Liu Chris Veld
author_sort	Hui Li (32376)
title	The effects of bank regulation stringency on seasoned equity offering announcements
title_short	The effects of bank regulation stringency on seasoned equity offering announcements
title_full	The effects of bank regulation stringency on seasoned equity offering announcements
title_fullStr	The effects of bank regulation stringency on seasoned equity offering announcements
title_full_unstemmed	The effects of bank regulation stringency on seasoned equity offering announcements
title_sort	effects of bank regulation stringency on seasoned equity offering announcements
publishDate	2018
url	https://hdl.handle.net/2134/11800953.v1
_version_	1797731542983770112

The effects of bank regulation stringency on seasoned equity offering announcements

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