Banks, Ownership Structure, and Firm Value in Japan

Posted: 7 Jun 2013

See all articles by Randall Morck

Randall Morck

University of Alberta - Department of Finance and Statistical Analysis; National Bureau of Economic Research (NBER); European Corporate Governence Institute; Asian Bureau of Finance and Economic Research

Masao Nakamura

University of British Columbia (UBC) - Sauder School of Business

Anil Shivdasani

University of North Carolina Kenan-Flagler Business School

Multiple version iconThere are 3 versions of this paper

Date Written: October 6, 1999

Abstract

We investigate the relation between firms' ownership structures and q ratios in Japan. At low levels of ownership by main banks, firms' q ratios fall as bank equity ownership rises. At higher levels of bank ownership, this relationship is mitigated and, in some specifications, even reversed. We argue that this relation reflects both costs and benefits of equity holdings by banks. In Japan, unlike the United States, firm value rises monotonically with increased managerial ownership. Equity ownership by corporate blockholders is also positively related to firm value in Japan.

Suggested Citation

Morck, Randall K. and Nakamura, Masao and Shivdasani, Anil, Banks, Ownership Structure, and Firm Value in Japan (October 6, 1999). Journal of Business, Vol. 73, No. 4, 2000; University of Alberta School of Business Research Paper No. 2013-618. Available at SSRN: https://ssrn.com/abstract=2275516

Randall K. Morck (Contact Author)

University of Alberta - Department of Finance and Statistical Analysis ( email )

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Masao Nakamura

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Anil Shivdasani

University of North Carolina Kenan-Flagler Business School ( email )

Kenan-Flagler Business School
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United States
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