Regulation of deposit-taking institutions: Price effect at disclosures of new regulations
This paper presents findings on the impact of revisions to a unique bank regulation yet studied. An old hypothesis in banking literature is tested by examining share price reactions to two-way changes to statutory reserve ratio (SRR) requirement over a recent eight-year period. Announcements of the...
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| Format: | Article |
| Language: | English |
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Universiti Utara Malaysia
2005
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| Online Access: | https://repo.uum.edu.my/id/eprint/3564/1/Nor3.pdf |
| _version_ | 1825740170492641280 |
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| author | Ahmad, Nor Hayati Ariff, Mohamed |
| author_facet | Ahmad, Nor Hayati Ariff, Mohamed |
| author_sort | Ahmad, Nor Hayati |
| collection | UUM |
| description | This paper presents findings on the impact of revisions to a unique bank regulation yet studied. An old hypothesis in banking literature is tested by examining share price reactions to two-way changes to statutory reserve ratio
(SRR) requirement over a recent eight-year period. Announcements of these regulatory changes appear to lead to statistically and economically significant abnormal returns.These new findings suggest that a decrease in statutory reserve has a risk-reducing effect on financial institutions. Thus, his study provides a test of the prediction of theory that SRR is a powerful macroeconomic policy tool to revive an economy in the aftermath of a financial crisis. |
| first_indexed | 2024-07-04T05:22:18Z |
| format | Article |
| id | uum-3564 |
| institution | Universiti Utara Malaysia |
| language | English |
| last_indexed | 2024-07-04T05:22:18Z |
| publishDate | 2005 |
| publisher | Universiti Utara Malaysia |
| record_format | eprints |
| spelling | uum-35642011-08-14T04:05:00Z https://repo.uum.edu.my/id/eprint/3564/ Regulation of deposit-taking institutions: Price effect at disclosures of new regulations Ahmad, Nor Hayati Ariff, Mohamed HG Finance This paper presents findings on the impact of revisions to a unique bank regulation yet studied. An old hypothesis in banking literature is tested by examining share price reactions to two-way changes to statutory reserve ratio (SRR) requirement over a recent eight-year period. Announcements of these regulatory changes appear to lead to statistically and economically significant abnormal returns.These new findings suggest that a decrease in statutory reserve has a risk-reducing effect on financial institutions. Thus, his study provides a test of the prediction of theory that SRR is a powerful macroeconomic policy tool to revive an economy in the aftermath of a financial crisis. Universiti Utara Malaysia 2005 Article PeerReviewed application/pdf en https://repo.uum.edu.my/id/eprint/3564/1/Nor3.pdf Ahmad, Nor Hayati and Ariff, Mohamed (2005) Regulation of deposit-taking institutions: Price effect at disclosures of new regulations. The International Journal of Banking and Finance , 3 & 4. pp. 63-72. ISSN 1617-722 http://epublications.bond.edu.au/ijbf/vol3/iss1/4/ |
| spellingShingle | HG Finance Ahmad, Nor Hayati Ariff, Mohamed Regulation of deposit-taking institutions: Price effect at disclosures of new regulations |
| title | Regulation of deposit-taking institutions: Price effect at disclosures of new regulations |
| title_full | Regulation of deposit-taking institutions: Price effect at disclosures of new regulations |
| title_fullStr | Regulation of deposit-taking institutions: Price effect at disclosures of new regulations |
| title_full_unstemmed | Regulation of deposit-taking institutions: Price effect at disclosures of new regulations |
| title_short | Regulation of deposit-taking institutions: Price effect at disclosures of new regulations |
| title_sort | regulation of deposit taking institutions price effect at disclosures of new regulations |
| topic | HG Finance |
| url | https://repo.uum.edu.my/id/eprint/3564/1/Nor3.pdf |
| work_keys_str_mv | AT ahmadnorhayati regulationofdeposittakinginstitutionspriceeffectatdisclosuresofnewregulations AT ariffmohamed regulationofdeposittakinginstitutionspriceeffectatdisclosuresofnewregulations |