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- Title
MARKET REACTIONS TO THE PASSAGE OF THE FINANCIAL HOLDING COMPANY ACT IN TAIWAN.
- Authors
JANE-SUE WANG; JING-TWEN CHEN; PIN-HUANG CHOU
- Abstract
We examine how financial institutions react to various events surrounding the passage of Taiwan's Financial Holding Company Act in June 2001. Empirical results indicate that the financial system experiences significant abnormal returns along the legislative process. Smaller firms have significantly higher abnormal returns, thus lending no support for the hypothesis that larger firms benefit more from the Act. Further analysis shows that the significance of market value is replaced by a significant securities industry effect, thereby consistent with the observation that Taiwan's securities firms are generally smaller in market values and are potential target firms for financial holding companies.
- Subjects
TAIWAN; FINANCIAL market reaction; HOLDING companies; FINANCIAL markets; FINANCIAL services industry; SECURITIES trading
- Publication
Pacific Economic Review, 2008, Vol 13, Issue 4, p453
- ISSN
1361-374X
- Publication type
Article
- DOI
10.1111/j.1468-0106.2008.00412.x