Shareholder value creation in Japanese banking

Article


Radić, N. 2015. Shareholder value creation in Japanese banking. Journal of Banking and Finance. 52, pp. 199-207. https://doi.org/10.1016/j.jbankfin.2014.09.014
TypeArticle
TitleShareholder value creation in Japanese banking
AuthorsRadić, N.
Abstract

This paper advances the study of Fiordelisi and Molyneux (2010) by examining the shareholder value efficiency and its determinants for a large sample of Japanese banks between 1999 and 2011. A new, specifically tailored measure of the Economic Value Added approach, based on the shadow price of equity, is developed in order to account for specific characteristics of the Japanese banking system. This new “shareholder value measure” is then used in a dynamic panel data model as a linear function of various bank-risk, bank-specific, and macroeconomic variables. This study finds that cost efficiency gains, credit risk and bank size are the most important factors in explaining the shareholder value creation in Japanese banking. Cost efficiency changes are also found to significantly influence cost of equity capital.

PublisherElsevier
JournalJournal of Banking and Finance
ISSN0378-4266
Publication dates
Online30 Sep 2014
Print01 Mar 2015
Publication process dates
Deposited17 Apr 2015
Accepted20 Sep 2014
Output statusPublished
Publisher's version
Copyright Statement

© 2014 The Author. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/3.0/).

Digital Object Identifier (DOI)https://doi.org/10.1016/j.jbankfin.2014.09.014
LanguageEnglish
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