Browsing by Subject "K22"

Sort by: Order: Results:

Now showing items 1-3 of 3
  • He, Qing; Huang, Jiyuan; Li, Dongxu; Lu, Liping (2016)
    BOFIT Discussion Papers 19/2016
    ​This paper examines the governance role of banks in replacement of underperforming CEOs in firms listed on Chinese stock exchanges. Under most circumstances, the findings suggest that the presence of outstanding loans does not increase the probability that a poorly performing CEO will be forced out and replaced. However, there is a positive and significant effect if the under-performing firm relies heavily on secured and short-term bank lending. Bank loans increase the likelihood of a forced CEO turnover in private firms, especially where joint-equity banks serve as the main lenders to the firm. There is no similar increase in the probability of a CEO turnover for state-owned firms or firms that borrow mainly from state-owned banks. Thus, where state ownership of banks and listed firms implies inefficiency or reluctance on monitoring borrower performance, there is an opportunity to improve loan contract arrangements to improve the mon-itoring role of lending banks.
  • Xu, Bing (2018)
    BOFIT Discussion Papers 3/2018
    Published in China Economic Review, 54, 2019, 237-255
    By allowing large classes of movable assets to be used as collateral, the Property Law reform trans-formed the secured transactions in China. Difference-in-differences tests show firms operating with ex-ante more movable assets expand access to bank credit and prolong debt maturity. However, the reform does not seem to improve the efficiency of credit allocation, as debt capacity of ex-ante low quality firms expands the most following the reform. Credit expansion also does not lead to better firm performance. These findings are not driven by confounding factors such as improvements in creditor and property rights protection. Our results also cannot be explained by other important reforms which were introduced around the same time as the introduction of the Property Law. These include anti-tunneling and split-share reforms and amendments to the corporate tax structure in China. We conduct explicit robustness tests for these other reforms and amendments to the corporate tax structure in China. We conduct explicit robustness tests for these other reforms and hence contribute to the empirical literature on the reform process in China with new findings.
  • Korkeamäki, Timo; Koskinen, Yrjö; Takalo, Tuomas (2007)
    Bank of Finland Research Discussion Papers 1/2007
    Published in Journal of Financial Stability, 3, 2007, pp. 33-58
    Finland experienced an extremely severe economic depression in the early 1990s.In the midst of this crisis, significant new legislation was passed that increased supervisory powers official market regulators and reformed bankruptcy procedures significantly decreasing the protection of creditors.We show that the introduction of these new laws resulted in positive abnormal stock returns.The new laws also lead to increases in firms'Tobin's q, especially for more levered firms.In contrast to previous studies, our results also suggest that public supervision of financial markets fosters rather than hampers financial market development. JEL Classification: G34, K22 Keywords: corporate governance, bankruptcy, financial supervision,shareholder protection, creditors' rights, corporate valuations, political economy