The Impact of Financial Crisis on Dividend Policy －Initial Public Offering Banks

• Main Authors: Yu Jen Hsu, 許又仁
• Other Authors: S. Y. Wen
• Format: Others
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/82u2pf

碩士 === 長庚大學 === 工商管理學系 === 102 === This paper investigates the impact of financial crisis on dividend policy to IPO banks in the U.S. The sample collection is from 2000 to 2012 years. We aim to capture the characteristic of the banks with dividend initiation and proceeding analysis by Tobit-regression. Next, we try to find the short-term effect of dividend announcement in the stock returns by event study. Our results show that there is no significant effect in the period of before and after dividend announcement, meaning that the signaling theory could not explains dividend initiation during the financial crisis. However, under the macroeconomic environments with regulatory shifting, invalid agent rating and asymmetric information, banks will pay more dividends in their dividend initiation. Many empirical studies support that the firms with features of large size, maturity and lower debt ratio will pay more dividends. In our study, however, we find the opposite results, which firm size is negative relate to dividend initiation and debt ratio is positive relate to dividend initiation. We inference is that large and maturity firms not a valid indicators during the crisis and smaller firms not stand for higher risky. In contrary, smaller firms with higher financial flexibility and have less impact during crisis. Moreover, high debt ratio might be has agency conflict between creditors and shareholders, the firms will pay more dividends to compensate the increased need for monitoring.