Market Reaction to the Russian Ukrainian War: A Global Analysis of the Banking Industry

Sabri Boubaker, N. Nguyen, V.Q. Trinh and T. Vu

Post-Print from HAL

Abstract: Purpose: The purpose of this paper is to study the market reactions of the banking industry to the Russian\textendashUkraine war. Design/methodology/approach: This paper uses an event study methodology, regression analyses and interaction effects to study the effect of the war on banks stock prices and analyze factors that explain the cumulative abnormal return. Findings: First, this study finds a significant decline of almost 1.5% in return on the war date. Similar patterns were observed for all continents, but Europe had the most severe drop of about 4%. Second, after excluding the contemporaneous influence of the whole market using the market model, global bank equities returns fell by about 1% on the war date, indicating that bank stocks were more severely impacted by the war than the average stock market. Net-of-market return approach further reveals that bank stock prices decreased 1.4% more on the event day compared to the prewar market average. Third, the impacts of the war and sanctions were persistent when the war continued. Banks stocks were most hit in Europe, Asia and North America. Originality/value: This paper pioneers the study of the effect of the Russia\textendashUkraine war on the banking industry. This paper also analyzes the reaction pattern of bank stocks before, during and after the war to explain the behavior and expectations of investors toward the war. \textcopyright 2022, Emerald Publishing Limited.

Keywords: Banking stocks; Capital market; Financial crisis; International finance; Market reactions; Russian\textendashUkraine war (search for similar items in EconPapers)
Date: 2023
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Published in Review of Accounting and Finance, 2023, 22 (1), pp.123--153. ⟨10.1108/RAF-10-2022-0294⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Market reaction to the Russian Ukrainian war: a global analysis of the banking industry (2023)
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:hal:journl:hal-04434025

DOI: 10.1108/RAF-10-2022-0294

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().