Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach
This study investigated stock market reaction and the effect of the implementation of Basel II and Basel III on stock returns of South African banks. In achieving this aim, this study focused on daily and annual data of six commercial banks from 3rd January 2004 to 31st December 2022. The event stud...
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Universiti Utara Malaysia Press
2024
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| 在線閱讀: | https://repo.uum.edu.my/id/eprint/31244/1/IJBF%2019%2002%202024%20183-210.pdf https://doi.org/10.32890/ijbf2024.19.2.3 https://repo.uum.edu.my/id/eprint/31244/ https://e-journal.uum.edu.my/index.php/ijbf/article/view/20507 https://doi.org/10.32890/ijbf2024.19.2.3 |
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my.uum.repo.312442024-08-11T05:10:08Z https://repo.uum.edu.my/id/eprint/31244/ Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach Oyetade, Damilola Muzindutsi, Paul-Francois HB Economic Theory This study investigated stock market reaction and the effect of the implementation of Basel II and Basel III on stock returns of South African banks. In achieving this aim, this study focused on daily and annual data of six commercial banks from 3rd January 2004 to 31st December 2022. The event study methodology was employed to identify abnormal returns around the specified event dates. The effect of the changes in Basel capital requirements on stock returns was not uniform across the four events. The market reacted favourably to the implementation of the Basel II requirements in the country. There was a significantly negative market reaction to the subsequent full implementation of Basel III official. Finally, higher Basel capital requirements (CAR) was associated with lower bank stock returns. The findings implied that bank regulators increase capital to strengthen the banking system but constrain the maximisation of shareholders’values Universiti Utara Malaysia Press 2024 Article PeerReviewed application/pdf en cc4_by https://repo.uum.edu.my/id/eprint/31244/1/IJBF%2019%2002%202024%20183-210.pdf Oyetade, Damilola and Muzindutsi, Paul-Francois (2024) Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach. The International Journal of Banking and Finance, 19 (2). pp. 183-210. ISSN 1675-7227 https://e-journal.uum.edu.my/index.php/ijbf/article/view/20507 https://doi.org/10.32890/ijbf2024.19.2.3 https://doi.org/10.32890/ijbf2024.19.2.3 |
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Universiti Utara Malaysia |
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UUM Library |
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Institutional Repository |
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Asia |
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Malaysia |
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Universiti Utara Malaysia |
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http://repo.uum.edu.my/ |
| language |
English |
| topic |
HB Economic Theory |
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HB Economic Theory Oyetade, Damilola Muzindutsi, Paul-Francois Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach |
| description |
This study investigated stock market reaction and the effect of the implementation of Basel II and Basel III on stock returns of South African banks. In achieving this aim, this study focused on daily and annual data of six commercial banks from 3rd January 2004 to 31st December 2022. The event study methodology was employed to
identify abnormal returns around the specified event dates. The effect of the changes in Basel capital requirements on stock returns was not uniform across the four events. The market reacted favourably to the implementation of the Basel II requirements in the country. There was a significantly negative market reaction to the subsequent full implementation of Basel III official. Finally, higher Basel capital requirements (CAR) was associated with lower bank stock returns. The findings implied that bank regulators increase capital to strengthen the banking system but constrain the maximisation of shareholders’values |
| format |
Article |
| author |
Oyetade, Damilola Muzindutsi, Paul-Francois |
| author_facet |
Oyetade, Damilola Muzindutsi, Paul-Francois |
| author_sort |
Oyetade, Damilola |
| title |
Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach |
| title_short |
Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach |
| title_full |
Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach |
| title_fullStr |
Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach |
| title_full_unstemmed |
Market Reaction to the Implementation of Basel Capital in South African Banks: Event Study Approach |
| title_sort |
market reaction to the implementation of basel capital in south african banks: event study approach |
| publisher |
Universiti Utara Malaysia Press |
| publishDate |
2024 |
| url |
https://repo.uum.edu.my/id/eprint/31244/1/IJBF%2019%2002%202024%20183-210.pdf https://doi.org/10.32890/ijbf2024.19.2.3 https://repo.uum.edu.my/id/eprint/31244/ https://e-journal.uum.edu.my/index.php/ijbf/article/view/20507 https://doi.org/10.32890/ijbf2024.19.2.3 |
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1809150981510791168 |
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13.250246 |