Equity returns in the banking sector in the wake of the great recession and the European sovereign debt crisis

Jorge Chan-Lau, Estelle X. Liu and Jochen M. Schmittmann

No 32/2013, Discussion Papers from Deutsche Bundesbank

Abstract: This study finds that equity returns in the banking sector in the wake of the Great Recession and the European sovereign debt crisis have been driven mainly by weak growth prospects and heightened sovereign risk and to a lesser extent, by deteriorating funding conditions and investor sentiment. While the equity return performance in the banking sector has been dismal in general, better capitalized and less leveraged banks have outperformed their peers, a finding that supports policymakers' efforts to strengthen bank capitalization.

Keywords: banks; equity returns; financial crisis; sovereign risk; sovereign debt crisis; economic growth; regulatory capital; panel data econometrics (search for similar items in EconPapers)
JEL-codes: G01 G14 G21 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-ban, nep-eec, nep-eff and nep-fmk
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Equity returns in the banking sector in the wake of the Great Recession and the European sovereign debt crisis (2015)
Working Paper: Equity Returns in the Banking Sector in the Wake of the Great Recession and the European Sovereign Debt Crisis (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:bubdps:322013

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