Japan's banking crisis

An event-study perspective

Hideaki Miyajima, Yishay Yafeh

Research output: Contribution to journalArticle

33 Citations (Scopus)

Abstract

We calculate abnormal stock returns for Japanese non-financial companies around major events associated with the banking crisis (1995-2000), and find that not all companies were equally sensitive to the malaise of the banking sector: the most affected were small, leveraged, low-tech companies with low credit ratings and low market to book ratios. This is consistent with "credit crunch" theories (companies with limited access to financial markets are sensitive to changes in bank lending) and with claims that innovation is rarely financed by bank debt. We do not find much evidence on the alleged misallocation of loans to support ailing bank clients.

Original languageEnglish
Pages (from-to)2866-2885
Number of pages20
JournalJournal of Banking and Finance
Volume31
Issue number9
DOIs
Publication statusPublished - 2007 Sep

Fingerprint

Book-to-market ratio
Misallocation
Banking sector
Event study
Banking crisis
Bank debt
Credit rating
Japan
Stock returns
Bank lending
Financial markets
Loans
Credit crunch
Innovation

Keywords

  • Banking crisis
  • Event-study
  • Japan

ASJC Scopus subject areas

  • Economics and Econometrics
  • Finance

Cite this

Japan's banking crisis : An event-study perspective. / Miyajima, Hideaki; Yafeh, Yishay.

In: Journal of Banking and Finance, Vol. 31, No. 9, 09.2007, p. 2866-2885.

Research output: Contribution to journalArticle

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