Template-Type: ReDIF-Article 1.0
Author-Name: Daniel Folkinshteyn
Author-Name: Gulser Meric
Title: The Financial Characteristics of Large and Small Firms Before and After the 2008 Stock Market Crash
Abstract: The financial crisis of 2008, and the associated bear market lasting from October 2007 to March 2009,
has had a significant impact on a broad cross section of firms in the global economy. Of particular
interest to us in this study is the effect of this time period on the financial characteristics of firms, with
extra focus on debt-related ratios. Using a large sample of U.S. firms from the COMPUSTAT database,
we find that firms, on average, come out of the financial crisis with less insolvency and bankruptcy risk,
more efficient asset utilization, and more attractive market valuations.
Classification-JEL: G00, G01, G32
Keywords: Financial Crisis, Financial Ratios
Journal: The International Journal of Business and Finance Research
Pages: 1-16
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-1.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:1-16

Template-Type: ReDIF-Article 1.0
Author-Name: Mihaela Craioveanu
Author-Name: Jose Mercado-Mendez
Title: The Role of Unused Loan Commitments and Transaction Deposits During the Recent Financial Crisis
Abstract: Our study looks at the financial condition of banks during the recent financial crisis. We focus on the
association between bank capital ratios and unused loan commitments and transaction deposits for
depository institutions. We test empirically whether loan commitments had a different impact on the
capital ratios of those banks that failed and did not fail during the recent financial crisis. We also analyze
the role of transaction deposits, a liquidity measure, on the financial condition of depository institutions.
We use a large data set for U.S. commercial banks between the first quarter of 2001 and the last quarter
of 2010. Our results suggest that unused loan commitments and transaction deposits had a significant
effect on the capital ratios of non-failed banks prior to the financial crisis, but only transaction deposits
affected the bank capital ratios of non-failed banks during the crisis. For failed banks, large levels of
unused loan commitments seem to be associated with capital ratios only during the financial crisis.
Classification-JEL: G21, G32, G33
Keywords: Unused Loan Commitments, Transaction Deposits, Bank Capital Ratios
Journal: The International Journal of Business and Finance Research
Pages: 17-29
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-2.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:17-29

Template-Type: ReDIF-Article 1.0
Author-Name: Fujen Daniel Hsiao
Author-Name: Yan Hu
Title: International Evidence of Spillover Effects of Deposit Rates:  A Multivariate Garch Model
Abstract: This paper uses the multivariate GARCH methodology to investigate spillover effects of deposit rates and
its volatility among the United States, Japan and German. Empirical results show that multivariate
GARCH (1,1) is appropriate and the deposit rate of one country is affected by the domestic long-term
government bond yield and money market rate. We find at the mean level, the deposit rate transmission is
from Japan to Germany, the United States to Germany and Germany to Japan. At the volatility level,
deposit rate volatility spillover is from Germany to Japan, from the United Sates to Japan, and from
Germany to the United States. Our findings contribute to the deposit rate literature of transmission and
spillover effect.
Classification-JEL: G15, G21
Keywords:  Deposit Rate, Multivariate GARCH, Transmission, Spillover, Mean, Volatility
Journal: The International Journal of Business and Finance Research
Pages: 31-44
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-3.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:31-44

Template-Type: ReDIF-Article 1.0
Author-Name: Ikechukwu Kelilume
Title:  Effects of the Monetary Policy Rate on Interest Rates in Nigeria 
Abstract: Monetary policy rate has remained a major potent monetary policy tool used by monetary authorities in
setting targets and direction of other rates and in driving the movement of other macroeconomic
aggregates in both developed and developing countries. In Nigeria however, the Central Bank has kept
monetary policy rate stable at 12 percent between October 2011 and September 2012 but stability in
monetary policy rate is hardly reflected in the movement short term and long term interest rates. The aim
of this study is to use the multivariate Vector Autoregressive Model to analyze the effects of monetary
policy rate on other rates in Nigeria. The study makes use of monthly data from M1:2007 to M9: 2012 to
evaluate the cause effect relationships between monetary policy rate and short term and long term rates
in Nigeria. The choice of the scope of the study lies in examining the response of interest rates to
monetary policy shock since the 2007-2008 global economic crises. Result obtained from this study will
be used to track the relative effectiveness of monetary policy in an emerging market where money market
instrument is not fully developed.
Classification-JEL: E4, E43, E52
Keywords: Monetary Policy, Monetary Policy Rates, Interest Rates
Journal: The International Journal of Business and Finance Research
Pages: 45-55
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-4.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:45-55

Template-Type: ReDIF-Article 1.0
Author-Name: M. Zahid Hasan
Author-Name: Ronald A. Ratti
Title: Australian Coal Company Risk Factors:  Coal and Oil Prices
Abstract: Examination of panel data on listed coal companies on the Australian exchange over January
1999 to February 2010 suggests that market return, interest rate premium, foreign exchange rate
risk, and coal price returns are statistically significant in determining the excess return on coal
companies’ stock. Coal price return and oil price return increases have statistically significant
positive effects on coal company stock returns. A one per cent rise in coal price raises coal
company returns by between 0.15% and 0.17%. A one per cent rise in oil price raises coal
company returns by between 0.06% and 0.08%. The sensitivity of stock prices to oil price shocks
suggest a role for investment in stocks that rise when energy prices increase in a well balanced
portfolio and in pursuing profitable investment strategies.
Classification-JEL: G12, G15, Q4
Keywords: Coal Stock Price, Coal Price, Oil Price
Journal: The International Journal of Business and Finance Research
Pages: 57-67
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-5.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:57-67

Template-Type: ReDIF-Article 1.0
Author-Name: Yung-Chuan Lee
Author-Name: Ming-Chang Wang
Title: Does the Appointment of Independent Directors Drive Multiple Effects?
Abstract: We analyze the announcement price behavior of independent director appointments stemming from
monitoring, signaling, advising effects and moderating effects of controlling shareholders. Based upon
appointments samples made by firms listed on the Taiwan Stock Exchange, we find that the cumulative
abnormal returns (CARs) of the announcement of voluntary independent director appointments are
significantly higher than those of the announcement of mandatory appointments. This empirical result
indicates that the market may well recognize that voluntary appointments of independent directors could
represent a signaling vehicle. Our findings also show that the monitoring and advising effects of
independent directors has failed under the presence of controlling shareholders.
Classification-JEL: G14, G38
Keywords: Independent Directors, Monitoring Effect, Signaling Effect, Advising Effect, Controlling Shareholders
Journal: The International Journal of Business and Finance Research
Pages: 69-88
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-6.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:69-88

Template-Type: ReDIF-Article 1.0
Author-Name: Ranjini L. Thaver
Author-Name: Christina Bova
Title: An Estimation of Ecuador's Export Demand Function with the US
Abstract: This paper employs the bounds testing approach to cointegration to estimate Ecuador’s export demand
function with the US between 1965 and 2011 with special emphasis on dollarization’s impact on expors .
We develop two different export demand models based on previous empirical studies of this nature. Model
I defines real exports as a function of the US real GDP, relative prices, exchange rate volatility, and
dollarization. Model II relates real exports to US real GDP, real exchange rate, volatility, and
dollarization. Results confirm a unique cointegration relationship between exports and its regressors in
Models I & II. In the long run, in both models, GDP is positive and elastic, while volatility is positive and
inelastic. Relative prices in Model I and real exchange rate in Model II are not statistically significant.
Both models reveal that dollarization has had a significant, but negative and inelastic long-run and shortrun
impact on Ecuador’s exports to the US. Further, Model I seems to be superior to Model II in terms of
the strength of cointegration, long-run and short-run elasticities, adjusted R2, and in satisfying diagnostic
tests.
Classification-JEL: F14, F31
Keywords: Ecuador, Export Demand, Dollarization, Elasticity, Cointegration
Journal: The International Journal of Business and Finance Research
Pages: 89-102
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-7.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:89-102

Template-Type: ReDIF-Article 1.0
Author-Name: Stoyu I. Ivanov
Author-Name: Kenneth Leong
Author-Name: Janis K. Zaima
Title: An Empirical Examination of Negative Economic Value Added Firms
Abstract: Economic value-added or EVA is a common metric that quantifies the value of the firm. However, recent
studies that examine portfolio investment strategies using EVA suggest that portfolios formed with
negative EVA earn relatively higher returns compared to some positive EVA firms. This study investigates
whether firms with current negative EVAs perform well in the future. A sample of firms with negative
EVAs in 2003 is identified, then four portfolios are formed by ranking firms from the most negative to the
least negative EVAs. The returns of the four portfolios are tracked from 2004 through 2009 and
correlated to four accounting variables, return on assets (NOPAT/TA), market-to-book ratio (MTB),
leverage, and size. The results indicate that the firms with lower leverage ratio exhibit higher portfolio
returns. Furthermore, firms in the categories defined as the least negative EVA and the second least
negative EVA are able to turn around and generate positive abnormal returns.
Classification-JEL: G10, G11, G32
Keywords: Economic Value Added (EVA), Market-to-Book, Portfolio Performance
Journal: The International Journal of Business and Finance Research
Pages: 103-112
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-8.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:103-112

Template-Type: ReDIF-Article 1.0
Author-Name: Dedhy Sulistiawan
Author-Name: Jogiyanto Hartono
Title: Can Technical Analysis Signals Detect Price Reactions Around Earnings Announcement?:  Evidence from Indonesia
Abstract: This study examines whether technical analysis signals can detect price reactions before and after
earnings announcement dates in Indonesian stock market. Earnings announcements produce reactions,
both before and after the announcements. Informed investors may use private information before earnings
announcements (Christophe, Ferri and Angel, 2004; Porter, 1992). Using technical analysis signals, this
study expects that retail investors (uninformed investors) can detect preannouncements reaction.
Technical analysis is selected because it is a powerful strategy, especially in developing stock market
(Fifield, Power, and Sinclair.2005; Ahmed, Beck, and Goldreyer, 2000), including Indonesia (McKenzie,
2007). This study also examines technical analysis signals after earnings announcements. Using the idea
that preannouncements reaction absorb post announcements reactions, this study expect that technical
analysis signals difficult to detect price reaction after earnings announcements. Using Indonesian data
over 2007-2011, the results show that technical analysis signal before earnings announcements can
produce profit, but signals after earnings announcements do not produce same results. Using several
different measures of return, the results are statistically robust. Based on those results, this study
concludes that technical analysis signal can detect reaction before announcements, but the signals don’t
work after earnings announcements. These findings contribute to accounting and technical analysis
literatures.
Classification-JEL: M41, G14
Keywords: Technical Analysis, Earnings Announcements
Journal: The International Journal of Business and Finance Research
Pages: 113-123
Volume: 8
Issue: 1
Year: 2014
File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v8n1-2014/IJBFR-V8N1-2014-9.pdf
File-Format: Application/pdf
Handle: RePEc:ibf:ijbfre:v:8:y:2014:i:1:p:113-123