 Do foreign bank investors promote acquiring banks' value in Asia-Pacific Countries?Yoko Shirasu and Yukihiro Yasuda No e202, Working Papers from Tokyo Center for Economic Research Abstract: Using comprehensive data on banks' M&A arrangements in Asia-Pacific countries from 2000 to 2014, we investigate differing performance effects based on the types of foreign institutional investors from the perspective of the acquirer bank's M&A strategies. Measured by the simple Q ratio, our results indicate that acquirer bank's future prospects in Asia-Pacific countries increase three years following the completion of M&A deals when the foreign institutional investors' is a bank type and has high equity stakes in the acquirer. In addition, acquirer banks' loan ratios are found to significantly increase without an accompanying increase in nonperforming loans when held by a bank type foreign investor. Moreover, banks' incomes from other fee-based businesses increase. By contrast, when an investment advisor or fund type of foreign institutional investors have high equity stakes, acquirer banks failed to expand core businesses in the long run, although some success is made in cost reduction in the short run. These results indicate that bank type foreign investors contribute to acquirer banks' future performance through influential advisory functions in the opaque banking industry of Asia. Pages: 59 pages Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:tcr:wpaper:e202 Access Statistics for this paper More papers in Working Papers from Tokyo Center for Economic Research Contact information at EDIRC. |
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