Dividend payouts: Evidence from U.S. bank holding companies in the context of the financial crisis

Abreu, José Filipe; Gulamhussen, Mohamed Azzim

doi:10.1016/j.jcorpfin.2013.04.001

Cited by 119 publications

(160 citation statements)

References 28 publications

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“…The results for the control variables (lower panel of the tables) are consistent with prior work on the factors driving corporate dividend policy (Abreu and Gulamhussen 2013, Hull 2013, Kanas 2013, Onali 2014, Srivastav et al 2013, as well as with expectations for the impact of the factors on the timing of dividend reductions by banking companies. In particular, higher profitability (net income/assets) and lower levels of non-performing loans tend to reduce the probability that a BHC cut or eliminated its dividend in a given quarter of the financial crisis period.…”

Section: The Timing Of Dividend Reductionssupporting

confidence: 86%

“…Above and beyond the impact on share price, banking companies may have been particularly sensitive to the negative market signal contained in a dividend decrease during the stressed market conditions and heightened uncertainty prevailing during the financial crisis. Abreu and Gulamhussen (2013), for instance, find that signaling was a significant determinant of dividend payout rates for BHCs during the financial crisis, though not in the years before the crisis.…”

Section: Bhc Dividends and Repurchases During The Financial Crisismentioning

confidence: 99%

“…The variables in the model specification include a series of control variables suggested by previous research as factors that affect corporate dividend payout policies (Abreu and Gulamhussen 2013, Hull 2013, Kanas 2013, Onali 2014, Srivastav et al 2014. These factors include firm size (log of total assets) and profitability (return on assets, calculated as after tax net income divided by total…”

Section: The Timing Of Dividend Reductionsmentioning

confidence: 99%

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Bank Holding Company Dividends and Repurchases during the Financial Crisis

Hirtle

2014

SSRN Journal

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Many large U.S. bank holding companies (BHCs) continued to pay dividends during the 2007-09 financial crisis, even as financial market conditions deteriorated, large losses accumulated, and emergency capital and liquidity were being provided by the official sector. In contrast, share repurchases by these BHCs dropped sharply in the early part of the crisis. Documenting this divergent behavior is one of the key contributions of this paper. The paper also examines the role that repurchases played in large BHCs' decisions to reduce or eliminate dividends. The key findings are that smaller BHCs in the sample with higher levels of repurchases before the financial crisis reduced dividends later and by less than BHCs with lower pre-crisis repurchases, suggesting that repurchases may have served as a cushion against cutting dividends. In contrast, there is only a weak relationship between pre-crisis repurchases and the timing and extent of dividend reductions for the larger BHCs, even though these BHCs were more likely overall to reduce or eliminate dividends during the crisis.

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Section: The Timing Of Dividend Reductionssupporting

confidence: 86%

Section: Bhc Dividends and Repurchases During The Financial Crisismentioning

confidence: 99%

Section: The Timing Of Dividend Reductionsmentioning

confidence: 99%

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Bank Holding Company Dividends and Repurchases during the Financial Crisis

Hirtle

2014

SSRN Journal

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“…In addition to the basic areas affecting financial distress, dividend changes have also long been viewed as a signal of both current and expected future firm prospects. Dividends work as a signal of future growth opportunities and this is consistent with the findings of Abreu and Gulamhussen (2013), Bessler and Nohel (1996), and Filbeck and Mullineaux (1993).…”

Section: Introductionsupporting

confidence: 84%

Monitoring mechanisms and financial distress of public listed companies in Malaysia

Kazemian

Shauri

Sanusi³

et al. 2017

Journal of International Studies

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Abstract. This study examines the relationships between financial distress and financial ratio (liquidity, leverage, profitability, firm's performance, and dividend) among public listed companies, using the Altman Z-Score to determine the financial distress levels among public listed companies in Malaysia. Five-year data has been collected (2010 to 2014) from the annual financial statements and from Data Stream of public listed companies in Malaysia. The findings indicate significant relationships between liquidity, leverage, profitability, firm's performance, and dividend with the financial distress levels among the companies in question. This study also examines the interaction effects of financial ratios and the year after implementation of the Malaysian Code on Soheil Kazemian, Noor Shauri, Zuraidah Sanusi, Amrizah Kamaluddin, Shuhaida Shuhdan Monitoring mechanisms and financial distress of public listed companies in Malaysia 93Corporate Governance (MCCG) in 2012 on financial distress levels. The results suggest that only liquidity and firm's performance have stronger effects on financial distress levels in two years after MCCG implementation. This indicates that after the implementation of the Code, liquidity and firms' performance ratios had strong and significant effect on financial distress levels. Overall, this study could help investors, creditors as well as external regulators in monitoring companies from being classified as financially distressed companies.

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“…Indeed, the empirical research has well documented a negative relation between managerial ownership and dividend policy (i.e., Lloyd et al, 1985;Jensen et al, 1992;Moh'd et al, 1995;Short et al, 2002). Examining the data from US financials, Collins et al (1996), Dutta (1999), and Dickens et al (2003 show that banks and insurance companies with a higher percentage of managerial ownership pay lower dividends, whereas Abreu and Gulamhussen (2013) find that US banks that are difficult to be monitored increase their dividend payments. This highlights the importance of the impact of ownership structure on dividend policy.…”

Section: H1h: Asset Tangibility Is Negatively Related To the Bist Finmentioning

confidence: 99%

The Factors Determining Dividend Policy of Financial Firms Listed on the Borsa Istanbul

Kılınçarslan

2018

BU Journal

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This study examines the factors determining the dividend policy of financial firms in Turkey. Analysing a panel dataset of 80 financial firms listed on the Borsa Istanbul over the period 2009-2016, the results reveal that profitability, debt, growth, firm size, liquidity and asset tangibility are the financial characteristics that have significant effects on dividend decisions. The findings also show that foreign shareholders are the only owners influencing financial firms in setting dividend payments, whereas board size, family members on the board and independent directors have significant impacts on dividend policies of financial corporations. Overall, the study results suggest that the major factors determining dividend policy decisions of financial firms in Turkey are similar to those of the industrial (non-financial) firms documented in the literature. Borsa İstanbul'da İşlem Gören Finansal Firmaların Temettü Politikalarını Belirleyen Faktörler ÖzetBu çalışma, Türkiye'deki finansal firmaların temettü politikalarını belirleyen faktörleri incelemektedir. Borsa İstanbul'da işlem gören 80 finansal firmanın, 2009-2016 döne-mine ait, panel verilerinin analizi sonucunda, kârlılık, borç, büyüme, firma büyüklüğü, likidite ve maddi duran varlıkların oranı, temettü kararlarında önemli etkiye sahip finansal özellikler olarak ortaya çıkmaktadır. Bulgular ayrıca sadece yabancı hissedarların finansal firmaların temettü ödemelerini etkileyen sahiplik çeşidi olduğunu göstermekle birlikte, yönetim kurulu büyüklüğünün, yönetim kurulundaki aile üyelerinin ve bağımsız yöneticilerin finans şirketlerinin temettü politikaları üzerine önemli etkilerini tespit etmiştir. Genel olarak, çalışma sonuçları Türkiye'deki finansal firmaların temettü politikalarını belirleyen başlıca faktörlerin, literatürde belirtilen ve sanayi (finansal olmayan) firmalarını etkileyen faktörlere benzer olduğunu göstermektedir.

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Dividend payouts: Evidence from U.S. bank holding companies in the context of the financial crisis

Cited by 119 publications

References 28 publications

Bank Holding Company Dividends and Repurchases during the Financial Crisis

Bank Holding Company Dividends and Repurchases during the Financial Crisis

Monitoring mechanisms and financial distress of public listed companies in Malaysia

The Factors Determining Dividend Policy of Financial Firms Listed on the Borsa Istanbul

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