The theory of financial intermediation highlights various channels through which capital and liquidity are interrelated. Using a simultaneous-equations framework, we investigate the relationship between bank capital buffer and liquidity for European and US publicly traded commercial banks from...

We take advantage of two parallel markets for a set of cash flows to show that better cash flow measurement improves the performance of a dividend discount model. Unlike previous literature, we use out-of-sample estimation. We construct a natural laboratory, by using a unique dataset of...

This study examines the relationship between Internet-based disclosure and capital market risk. Based on prior research, an index of 49 items is developed to evaluate the level of Internet-based voluntary disclosure in France. Three measures are used to present the capital market risk: total...

In the 1990s, European merger regulation (EMR) was biased against foreign acquirers, especially if the deal harmed domestic rivals (i.e., protectionism). In 2002, the Court of First Instance overturned three prohibitions by the European Commission (EC) and criticized its economic analysis. These...

We investigate bank loans' specialness with a particular focus on the recent boom and bust cycle. We perform an empirical analysis using event study methodology on a sample of 253 large loan announcements for French borrowers between January 2000 and December 2009. We find a significant and...

Long run returns of IPO firms' recommendations in Europe reveal possible conflicts of interest and pressures faced by financial analysts over the 1991-2005 period. Nevertheless, recent European legislations about investment research have led to better long run performance of IPO firms'...

We examine, in this paper, whether or not subprime mortgage crisis-related write-downs are mainly due to banks involvement in credit risk transfer market (CRT). Using data from 288 European banks over the period 2004-2007, we find that, for different types of CRT involvement, different patterns...

This paper presents a theory for Islamic venture capital namely ‘Mudharabah' contract under adverse selection problem. In order to avoid selecting a low type entrepreneur for a given good project, the framework defines the profit sharing ratio (PSR) as a screening device. We then develop a...

This study examines how bank ownership influenced the credit supply during the recent financial crisis in Russia, where the banking sector consists of a mix of state-controlled banks, foreign-owned banks, and domestic private banks. To estimate credit supply changes, we employ an exhaustive...

The instability of banks during the recent financial crisis underlines the importance of understanding how banks determine their capital ratios. This paper conducts the first empirical assessment on how banks adjust their capital ratios following an exogenous shock to their asset risks. The...