Literature Review Women on boards and in TMTS and firm performance124 In light of their special importance for the present paper I present investigations that relate to the financial sector in more detail even if they were published earlier than 2007 I identify four relevant studies The first analysis specifically concerning the ban king sector was conducted by Madura et al 1995 The timeframe for their event study is 1984 to 1992 research subject are 48 layoff announ cements by US banks that are listed on the ASE or NYSE at the time of the event Assuming that banks share many similar features due to high re gulation within the sector the authors expect int ra industry effects of bank layoff announcements General sector conditions such as falling demand for bank services eventually leading to restructu ring measures including layoffs should apply for all institutions Provided that the underlying causes for layoffs are industry wide a layoff announce ment may have a signal function for competitors future performance and thus lead to a revaluation of the rivals shares Madura et al 1995 Announ cing firms experience a negative and significant share price reduction on the announcement day The analysis further yields positive and significant intra industry effects Share price reactions for rival banks are positive on the announcement day The authors see support for the theory that competitive effects dominate over contagion effects Announ cements of staff cuts may signal an opportunity for rival banks to gain market share or valuable human capital23 These spill over effects are more advantageous if announcing and rival banks are established in the same region and also in time periods characterized by high banking industry earnings Elayan et al 1998 investigate 646 layoff announ cements in the United States from 1979 to 1991 in a cross sector analysis The cumulative average ab normal return CAAR for the total sample is 0 64 percent during the 1 0 event window and signi ficant The subsample financial institutions com prises 87 announcements with a stronger negative and highly significant CAAR of 1 60 percent The findings indicate that announcements of planned redundancies convey negative information about a firm s current status and possibly also its prospects including poor investment or growth opportunities or uncertain future cash flows and are thus consis tent with the declining investment opportunities hypothesis The negative market reaction results from a downwards revaluation by shareholders in duced by the unexpected bad news Cagle et al 2009 analyze notifications of US fi nancial institutions during the period 1994 to 2003 Their sample is divided by firm type into three sub groups namely banks and bank holding companies 42 announcements security brokers and dealers 21 and others including non depositary financial institutions 15 Contrary to Madura et al 1995 banks in their sample on average experience a po sitive and significant CAAR of 1 31 percent during the 1 1 event window Stock price reaction for the second group of brokers and dealers is ne gative but only weakly significant No significant share price reaction can be observed for the third group comprising other financial institutions The favorable returns for banks remain after controlling for firm and layoff size stated reason and gover nance structure Thus evidence is provided for in ter financial services industry differences in share price reaction to layoff announcements Cagle et al 2009 Furthermore the results support the idea that strict regulation affecting banks reduces asymmetric information associated with layoff an nouncements while that is not the case for brokers and dealers and other financial institutions Capital markets may thus perceive bank notifications on 23 Goldman Sachs for instance is believed to dismiss employees in order to pick the best talent available at some of its rivals Even though the company is planning to cut its workforce soon it is believed that the group is expecting its overall headcount to increase this year Global Banking News 2008 June 16 Layoffs and shareholder wealth

Vorschau DIRK-Forschungsreihe Band 21 Workforce diversity and personal policies Seite 124
Hinweis: Dies ist eine maschinenlesbare No-Flash Ansicht.
Klicken Sie hier um zur Online-Version zu gelangen.