Bank shares restore under recent industry bailouts

Simona Mihai Yiannaki

World Review of Entrepreneurship, Management and Sustainable Development, 2010, vol. 6, issue 4, 336-349

Abstract: This paper structures ten effective implications/lessons of the most recent bank bailouts of 2007-2009 in the Western economy model when analysing actual shareholders' value retrenchment or growth opportunities. The author finds that recent bank bailouts relate to: global bailout interconnections, economic downturn and liquidity boost, abnormal returns, efficiency recovery, evade social costs, new opportunities for M&A, new risk management applications, opportunistic investors and eventually patience. The novelty of the paper resides not in calculating ratios and interpreting them, but rather to looking more into some interesting strategic moves used to boost shareholders' value. We recommend shareholders to grasp opportunities for bargains from bailout banks, get more knowledge about the issue and still harvest their existing investments. Eventually, we advise the management of both government and financial institutions on the choice for reasoning bank bailouts, providing some critical thinking views and raise important research questions to both investors and academics.

Keywords: shareholder value; banks; banking; bailouts; consolidation; mergers; acquisitions; financial crises; social responsibility; corporate responsibility; bank shares; Western economy; global interconnections; globalisation; economic downturns; liquidity boosts; abnormal returns; efficiency recovery; cost evasion; social costs; new opportunities; risk management; opportunistic investors; opportunism; patience; ratios; bargains; share issues; investments; entrepreneurs; entrepreneurship; entrepreneurialism; relations management; relationships; value creation; sustainable development; sustainability. (search for similar items in EconPapers)
Date: 2010
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