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The Roles of Banks hold by the Group-Affiliated Firms: Evidences from the Cases of Taiwan
Journal of Financial Studies
View Archive Info| Field | Value | |
| Title |
The Roles of Banks hold by the Group-Affiliated Firms: Evidences from the Cases of Taiwan
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| Creator |
Chien-An Wang
Chung-Hua Shen |
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| Description |
This paper discusses the different roles of banks belonged to the conglomerates. We suggest three hypotheses explained the possible functions of group-affiliated banks: (1)as an easing-financial constrained provider of group firms, (2)as an insurer of group firmsf liquidity in the period of financial crisis, (3)as a cheaper funding source of group firms. Using the regression models, our empirical results seem to support the former two hypotheses. The member bank would not offer cheaper funds to its group-affiliated firms, by contrast, to ask for the higher lending interest rate. But in the unusual period of financial crisis, the member bank may provide the liquidity and release firmsf financial constraints owing to the whole group benefits. We find firms that affiliated with the bank obtain funds by increasing their credit lines in the period of financial distress while the credit crunch policy was taken by other general banks. Moreover, the banking-and-finance oriented conglomerates donft afford the loans of the lower interest rate to its groupsf firms for self-interests. Keywords: Financial Constraints, Liquidity Insurance, Cheaper Funding Source, Bank-Group |
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| Publisher |
Journal of Financial Studies
財務金èžå¸åˆŠ |
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| Date |
2011-06-22
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| Type |
—
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| Format |
application/pdf
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| Identifier |
http://www.jfs.org.tw/index.php/jfs/article/view/2011165
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| Source |
Journal of Financial Studies; Vol 12, No 3 (2004); 33
財務金èžå¸åˆŠ; Vol 12, No 3 (2004); 33 |
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| Language |
—
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