On the Change of Bank Equity Stakes before Mergers

• Main Authors: Huang Yu Lun, 黃于倫
• Other Authors: LinLin
• Format: Others
• Language: zh-TW
• Published: 2007
• Online Access: http://ndltd.ncl.edu.tw/handle/32223523670646917972

碩士 === 國立暨南國際大學 === 財務金融學系 === 95 === This study investigates the relationship between the changes of the shareholdings of the institutional financial/investment professionals and the firm-specific characteristics of the acquiring companies prior to merger completion dates, thereby identifying factors dominating their investment behavior. Both total and average changes of their ownership are considered to test the popular agency and signaling hypotheses. Evidence shows that commercial banks are more likely to increase their equity holdings of the businesses with increasing current liability and decreasing profitability. The former supports signaling hypothesis but the latter seems to suggest agency cost hypothesis. Investment banks, on the other hand, prefer those with increasing assets and stable financial statuses. A competitive relation of these financial experts is also pictured in terms of the pursuit of a higher controlling power over the board against each other before the merger completion date.