Journal article
Global banks and internal capital markets: Evidence from bank-level panel data in emerging economies
Journal of multinational financial management, v 28, pp 79-94
Dec 2014
Featured in Collection : UN Sustainable Development Goals @ Drexel
Abstract
•The paper addresses the operation of internal capital markets in multinational banks.•Internal capital markets alleviate bank subsidiaries’ lending growth-to-internal funds sensitivity.•The effect of internal capital markets is more pronounced in higher capitalized and smaller subsidiaries.•The effect of internal capital markets is dampened with host expansionary monetary policy.
In this paper, we examine the operation of internal capital markets within multinational financial conglomerates. We observe the lending behavior of foreign subsidiaries of the major multinational banks which conduct banking activities in emerging and developing countries. Using loan growth-to-internally generated funds sensitivity as a measure of subsidiary's financing constraints, we explore whether such sensitivity is correlated with the availability of internally generated funds at the consolidated banking organizational level, and find robust evidence for the operation of internal capital markets. We also provide evidence that internal capital markets of multinational banks alleviate financial constraints faced by their foreign subsidiaries.
Metrics
Details
- Title
- Global banks and internal capital markets: Evidence from bank-level panel data in emerging economies
- Creators
- Bang Nam Jeon - Drexel UniversityJi Wu - Southwestern University of Finance and Economics
- Publication Details
- Journal of multinational financial management, v 28, pp 79-94
- Publisher
- Elsevier
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Economics (School of Economics)
- Web of Science ID
- WOS:000213920200006
- Scopus ID
- 2-s2.0-84909988986
- Other Identifier
- 991019330628604721
UN Sustainable Development Goals (SDGs)
This publication has contributed to the advancement of the following goals:
InCites Highlights
Data related to this publication, from InCites Benchmarking & Analytics tool:
- Collaboration types
- Domestic collaboration
- International collaboration
- Web of Science research areas
- Business, Finance