Comment on Handlock, Houston, and Ryngaert

نویسنده

  • R. Glenn Hubbard
چکیده

Over the past two decades, researchers in industrial organization in corporate ®nance have examined relationships between ``corporate governance'' and ``®rm performance''. In an interesting and provocative paper, Charles Hadlock, Joel Houston, and Michael Ryngaert analyze the impact of proxies for corporate governance, managerial incentives, and performance on the likelihood of a bankÕs being acquired. Given the pace of activity in the bank acquisition market and concern in some quarters about consolidation in the US banking industry, the authorsÕ study is timely. After reviewing the key points in the paper, my comment proceeds in three steps. First, I place the authorsÕ empirical approach in the context of recent work on equilibrium models of corporate performance. Second, I use that intuition to suggest ways to design and interpret tests of relationships among bank governance, performance, and acquisitions. Third, I suggest some ``next steps'' in the empirical research programs initiated by the authors. While many extensions are possible, the paper nonetheless is a nice contribution to our understanding of how managerial incentives a€ect bank acquisitions. Journal of Banking & Finance 23 (1999) 250±254

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تاریخ انتشار 1999