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Identifier to cite or link to this item: https://hdl.handle.net/10086/27960

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Title
Relationships matter: The impact of bank-firm relationships on mergers and acquisitions in Japan
Creator
Creator Name
FRENCH, Joseph FRENCH, Joseph
Affiliation
Affiliation Name
University of Northern Colorado
Creator Name
YAN, Juxin YAN, Juxin
Affiliation
Affiliation Name
Hitotsubashi University
Creator Name
YASUDA, Yukihiro YASUDA, Yukihiro
安田, 行宏 安田, 行宏
Affiliation
Affiliation Name
Hitotsubashi University
Key Word
Mergers and Acquisitions
Relationship Banking
Japan
JEL
G01
G21
G34
Abstract
We dissect the influence of bank-firm relationships on mergers and acquisitions in Japan. Using a comprehensive data set spanning fifteen years, we show that stronger bank-firm relationships generally increase the likelihood and size of M&A. Contrary to conventional wisdom of the adverse effects of bank-firm relationships in Japan, such as ‘zombie lending', our results indicate that Japanese banks facilitate restructuring in the 2000's. However, in cases where a bank plays a dual role as a lender and shareholder to a firm, the likelihood and size of M&A declines. This result stems from a bank's desire to maintain existing corporate governance mechanisms and control rights.
Description
First Draft: March 10 This Version: June 14
Publisher
Hitotsubashi University Center for Financial Research
Issued Date
2016-06-14
Language
English(eng)
Resource Type
technical report
Version Type
VoR
Is Part OfRelation -
Related Title
Working Paper Series ; No. G-1-15
Number of Pages
32
Appears in Collections
Working Paper Series / Hitotsubashi University Center for Financial Research
URL
https://hdl.handle.net/10086/27960