A Note on Shareholder Oversight and the Regulatory Environment: The Japanese Banking Experience

Kenneth Kim and S. Ghon Rhee

No 2000-2, CEI Working Paper Series from Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University

Abstract: During a period where Japanese banks operated under a less restrictive regulatory environment, 1986-88, we find positive relationships between bank risk and ownership concentration. This empirical evidence reveals shareholder activism by the largest shareholders. During the periods immediately before and immediately after this particular subperiod, which are characterized by stricter regulatory environments, we do not observe evidence of shareholder activism. Taken together, these results are consistent with the argument that restrictive regulation and shareholder oversight are substitutes for one another. Time-series results and bank performance results yield consistent evidence.

Keywords: Large shareholders; Japanese banks; bank risk; shareholder oversight (search for similar items in EconPapers)
JEL-codes: G21 G28 G32 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2000-01
Note: Current Draft: January 2000
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hit:hitcei:2000-2

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