Abstract
Leveraging branch-level data on bank deposits, we provide evidence of a negative impact of branching restrictions on payout ratios, which occurs only for banks with a low charter value, as proxied by the market-to-book ratio. The results for the market-to-book ratio extend to the Lerner index, the return on assets, and the Z-score, suggesting that risk-shifting incentives drive our results rather than signaling incentives or agency costs. Our results are robust to different proxies for banking competition and identification strategies, and bootstrap simulations suggest that our results are not due to confounding factors.
Original language | English |
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Number of pages | 42 |
Journal | Journal of Money, Credit and Banking |
Early online date | 23 Feb 2023 |
DOIs | |
Publication status | Published - 23 Feb 2023 |
Keywords
- competition
- dividends
- payout policy
- share repurchases
ASJC Scopus subject areas
- Economics, Econometrics and Finance(all)
- General Business,Management and Accounting