 Do insurance activities enhance the performance of financial services holding companies?Mu-Sheng Chang and Elyas Elyasiani Applied Economics, 2015, vol. 47, issue 33, 3559-3576 Abstract: Stiroh and Rumble (2006) and Yeager et al . (2007) have argued that extension of banks into nonbanking activities produces no diversification benefits for financial services holding companies (FSHCs) eligible to consolidate banking and insurance products. We investigate the effect of aggregate nonbank activities, as well as two main areas of insurance business, namely agency and underwriting enterprise, on the risk-adjusted performance of FSHCs. Our sample includes a quarterly panel data of FSHCs over the period 2003-2011. We find that the effect of FSHCs' entry into agency insurance activities on their risk-adjusted returns is dependent on their size; it is positive for FSHCs in the top quartile of our sample (assets greater than $4.495 billions), but negative for smaller and mid-size FSHCs. The effect of underwriting insurance activities on risk-adjusted returns is generally negative or statistically insignificant, except for some of the largest-size firms. Date: 2015 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:applec:v:47:y:2015:i:33:p:3559-3576 Ordering information: This journal article can be ordered from DOI: 10.1080/00036846.2015.1019032 Access Statistics for this article Applied Economics is currently edited by Anita Phillips More articles in Applied Economics from Taylor & Francis Journals |
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