An Analytical Framework of Bank Merger and Reinvestment Decision Under Maximizing Equity Values

29 Pages Posted: 24 Jun 2002

See all articles by Hsienyu Yin

Hsienyu Yin

Shih Chien University - Graduate Institute of Business Administration

Soushan Wu

Securities & Futures Institute

Abstract

This article evaluates equity value by option pricing model taking a consolidated financial institute as a new portfolio to analyze consolidated situation of risk and equity value. Besides finding how the banks selecting portfolio to maximizing net equity value subject to capital regulation constraint, we also discuss the factors affecting selecting behaviors and the necessary conditions leading to consolidated synergy.

Suggested Citation

Yin, Hsienyu and Wu, Soushan, An Analytical Framework of Bank Merger and Reinvestment Decision Under Maximizing Equity Values. EFMA 2002 London Meetings. Available at SSRN: https://ssrn.com/abstract=314893 or http://dx.doi.org/10.2139/ssrn.314893

Hsienyu Yin

Shih Chien University - Graduate Institute of Business Administration ( email )

200 University Road
Ney-Nan Tsun
Taiwan, ROC, Kaohsiung

Soushan Wu (Contact Author)

Securities & Futures Institute ( email )

9F, 3, Nan-Hai Rd.
Taipei, 10066
Taiwan

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