Bank Value and Geographic Diversification: Regional vs Global

Canan Yildirim () and Georgios Efthyvoulou
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Canan Yildirim: Faculty of Economics, Administrative and Social Sciences, Kadir Has University

No 2016001, Working Papers from The University of Sheffield, Department of Economics

Abstract: This paper analyzes the impact of geographic diversification on bank value by employing a data set comprising the largest banks across the world, originating from both developed and emerging countries. The findings suggest that the value impact of international diversification depends on the financial development level of a bank’s home country: higher levels of diversification are associated with changes in valuations only for banks originating from emerging countries. In addition, the locus of internationalization matters for the direction of effects: while markets respond positively to the intra-regional expansion activities of emerging country banks, they seem to believe that these banks cannot benefit from diversifying into far away markets.

Keywords: multinational banking; geographic diversification; bank value (search for similar items in EconPapers)
JEL-codes: F23 G21 G32 L22 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2016-01
New Economics Papers: this item is included in nep-ban
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http://www.sheffield.ac.uk/economics/research/serps/articles/2016_001 First version, January 2016 (application/pdf)

Related works:
Journal Article: Bank value and geographic diversification: regional vs global (2018)
Working Paper: Bank value and geographic diversification: regional vs global (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:shf:wpaper:2016001

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