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Can firms learn by observing? Evidence from cross-border M&As

Francis, Bill B.; Hasan, Iftekhar; Sun, Xian; Waisman, Maya - Suomen Pankki - 2014

In the presence of high uncertainty and limited experience, can observing the actions of other acquiring predecessors help firms make better acquisition decisions? Using a sample of cross-border M&As conducted by US acquirers in developing countries, we document a positive and significant...

Persistent link: https://www.econbiz.de/10010945113

Do corporate boards affect firm performance? New evidence from the financial crisis

Francis, Bill; Hasan, Iftekhar; Wu, Qiang - Suomen Pankki - 2012

This study uses the current financial crisis as a quasi-experiment to examine whether and to what extent corporate boards affect the performance of firms. Using cumulative stock returns over the crisis to measure of firm performance, we find that board independence, as traditionally defined,...

Persistent link: https://www.econbiz.de/10010542073

Leverage and growth: effect of stock options

Francis, Bill; Hasan, Iftekhar; Sharma, Zenu - Suomen Pankki - 2011

This paper investigates the potential effects of stock options on managers’ investment decisions and therefore on a … compensation in manager’s portfolio increases, the negative effect of leverage on growth disappears. The paper argues that this is … an important finding, because it implies that when managers are compensated with options debt ceases to pre …

Persistent link: https://www.econbiz.de/10009358948

Corporate boards and bank loan contracting

Francis, Bill; Hasan, Iftekhar; Koetter, Michael; Wu, Qiang - Suomen Pankki - 2012

We investigate the role of corporate boards in bank loan contracting. We find that when corporate boards are more independent, both price and nonprice loan terms (e.g., interest rates, collateral, covenants, and performance-pricing provisions) are more favorable, and syndicated loans comprise...

Persistent link: https://www.econbiz.de/10010548600

Are firm- and country-specific governance substitutes? Evidence from financial contracts in emerging markets

Francis, Bill; Hasan, Iftekhar; Song, Liang - Suomen Pankki - 2012

We investigate how borrowers’ corporate governance influences bank loan contracting terms in emerging markets and how this relation varies across countries with different country-level governance. We find that borrowers with stronger corporate governance obtain favorable contracting terms with...

Persistent link: https://www.econbiz.de/10010548603

Cross-border bank M&As and risk: evidence from the bond market

Choi, Sungho; Francis, Bill B; Hasan, Iftekhar - Suomen Pankki - 2010

increase in risk-taking incentives for bank managers and stockholders following these transactions. This paper empirically …

Persistent link: https://www.econbiz.de/10008626085

Law and stock markets: evidence from an emerging market

Korkeamäki, Timo; Rainio, Elina; Takalo, Tuomas - Suomen Pankki - 2010

A sweeping and protracted reform of corporate law took place in Finland in the 1970s. The reform brought significant improvements to investor protection and, similar to the US Sarbanes-Oxley Act, tightened disclosure rules at the cost of increasing the work load in corporate reporting. We find...

Persistent link: https://www.econbiz.de/10008496954

Pre-emptive horizontal mergers: theory and evidence

Molnar, Jozsef - Suomen Pankki - 2007

This paper proposes and tests an explanation as to why rational managers seeking to maximize shareholder value can …

Persistent link: https://www.econbiz.de/10005190742

Agency Cost of Debt and Lending Market Competition: A Re-Examination

Koskela, Erkki; Stenbacka, Rune - Suomen Pankki - 2000

We address how lending market competition, measured by banks’ bargaining power, affects the agency costs of debt finance. We show that the threshold for obtaining loan finance is independent of the relative bargaining power of the financier. Moreover, intensified lending market competition...

Persistent link: https://www.econbiz.de/10005190771

Financial market integration and the value of global diversification: evidence from US acquirers in cross-border mergers and acquisitions

Francis, Bill B; Hasan, Iftekhar; Sun, Xian - Suomen Pankki - 2006

Using theories of internal capital markets, this paper examines the link between financial market integration and the value of global diversification. Based on a sample of 1,491 completed cross-border mergers and acquisitions (M&As) conducted by US acquirers during the 1990–2003 period, we...

Persistent link: https://www.econbiz.de/10005419680