Foreign ownership, bank information environments, and the international mobility of corporate governance

Yiwei Fang (), Iftekhar Hasan, Woon Sau Leung () and Qingwei Wang
Additional contact information
Yiwei Fang: Illinois Institute of Technology
Woon Sau Leung: University of Edinburgh Business School

Journal of International Business Studies, 2019, vol. 50, issue 9, No 7, 1566-1593

Abstract: Abstract This paper investigates how foreign ownership shapes bank information environments. Using a sample of listed banks from 60 countries over 1997–2012, we show that foreign ownership is significantly associated with greater (lower) informativeness (synchronicity) in bank stock prices. We also find that stock returns of foreign-owned banks reflect more information about future earnings. In addition, the positive association between price informativeness and foreign ownership is stronger for foreign-owned banks in countries with stronger governance, stronger banking supervision, and lower monitoring costs. Overall, our evidence suggests that foreign ownership reduces bank opacity by exporting governance, yielding important implications for regulators and governments.

Keywords: multiple regression analysis; agency theory; internationalization theories and foreign market entry; international financial integration; foreign bank ownership; stock price synchronicity (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://link.springer.com/10.1057/s41267-019-00240-w Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:jintbs:v:50:y:2019:i:9:d:10.1057_s41267-019-00240-w

Ordering information: This journal article can be ordered from
http://www.springer. ... nt/journal/41267/PS2

DOI: 10.1057/s41267-019-00240-w

Access Statistics for this article

Journal of International Business Studies is currently edited by John Cantwell

More articles in Journal of International Business Studies from Palgrave Macmillan, Academy of International Business
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().