Is Bancassurance a Viable Model for Financial Firms?

18 Pages Posted: 18 Nov 2007

See all articles by Paige Fields

Paige Fields

University of Kansas

Donald R. Fraser

Texas A&M University - Department of Finance

James W. Kolari

Texas A&M University - Department of Finance

Abstract

The bancassurance (i.e., bank and insurance company combinations) model for financial firm architecture has been widely used in Europe and recently has been adopted by U.S. financial firms. We provide evidence regarding the viability of bancassurance combinations for U.S. and non-U.S. mergers between 1997 and 2002. We find positive gains and no significant risk shifts for shareholders of bidding firms, and that higher CEO stock ownership results in less positive gains for shareholders. These and other results suggest that bancassurance firms are viable entities that may play an important role in the future evolution of the U.S. financial system.

Suggested Citation

Fields, Paige and Fraser, Donald R. and Kolari, James W., Is Bancassurance a Viable Model for Financial Firms?. Journal of Risk & Insurance, Vol. 74, No. 4, pp. 777-794, December 2007. Available at SSRN: https://ssrn.com/abstract=1030865 or http://dx.doi.org/10.1111/j.1539-6975.2007.00234.x

Paige Fields (Contact Author)

University of Kansas ( email )

1654 Naismith Dr.
Lawrence, KS 66045
United States

Donald R. Fraser

Texas A&M University - Department of Finance ( email )

430 Wehner
College Station, TX 77843-4218
United States
979-845- 2020 (Phone)

James W. Kolari

Texas A&M University - Department of Finance ( email )

MS-4218
Department of Finance
College Station, TX TX 77843-4218
United States
979-845-4803 (Phone)
979-845-3884 (Fax)

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