Seasoned Equity Offering Announcements and the Returns of European Bank Stocks and Bonds

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

We analyze, by means of appropriate event studies, the returns following seasoned equity offering announcements made by western European banks between 2008 and 2014. Consistently with the pertinent literature on non-financial companies, we find that shareholders experience negative returns. We highlight that the same occurs for bondholders, although not surprisingly to a smaller extent. Overall, our results show that seasoned equity offering announcements play an important signalling role also in the banking industry, despite the tight regulation and supervision by banking authorities, which should in principle reduce the impact on pricing of the information asymmetries about banks' financial conditions.
Original languageEnglish
Pages (from-to)1339-1359
Number of pages21
JournalApplied Economics
Volume51
Publication statusPublished - 2019

Keywords

  • event study
  • excess bond returns
  • excess stock returns
  • seasoned equity offerings
  • security issuance

Fingerprint

Dive into the research topics of 'Seasoned Equity Offering Announcements and the Returns of European Bank Stocks and Bonds'. Together they form a unique fingerprint.

Cite this