Literature Review Women on boards and in TMTS and firm performance 139 Figure 5 2 Stock price reactions to bank layoff announcements by underlying strategy 0 5 4 3 2 1 0 1 2 3 4 5 0 5 1 1 5 2 0 2 5 3 0 cu m ul at iv e av er ag e ab no rm al re tu rn C AA R in Total sample Proactive layoff strategy Reactive layoff strategy days relative to announcement day Results for the total sample are statistically signifi cant for all event windows Panel A in Table 5 4 Yet the separate consideration of the two layoff strategies shows that the observed CAARs for pro active layoffs are not statistically significant Panel C in Table 5 4 These findings contradict evidence from previous studies suggesting that stock price reactions to proactive layoffs are positive and signi ficant Capelle Blancard Tatu 2012 Fraunhoffer et al 2014 The analyses of Knauer and Lach mann 2011 as well as Neus and Walter 2009 however similarly yielded no significant results for proactive layoffs The observed CAARs for reactive layoffs in my ana lysis are negative and statistically highly signifi cant consistent with the findings of Capelle Blan card Tatu 2012 and also Neus and Walter 2009 Capital markets assess job cuts by banks in response to adverse conditions or poor past per formance as value decreasing measures I observe the strongest share price decline of 2 73 percent in the 11 days event window 5 5 Panel C in Table 5 4 The magnitude of the reaction is far greater in comparison with prior findings but still substanti ally below the level for crisis year 2008 shown by Marshall et al 2012 when bank shares fell up to 10 58 in reaction to layoff announcements Figure 5 2 displays the stock price reaction to layoff announcements by banks in the United States and Western Europe The graphs show the share price reaction in an event window of eleven days around the announcement day for the total sample as well as for layoffs that are a proactive measure and for layoffs that are a reactive measure Hypothesis 3 states that stock price reactions will be zero or positive during rising financial markets and negative during the financial crisis Capital markets reactions in fact differ notably depen ding on the period observed Stock price reactions are positive yet not significant during the pre crisis years January 2004 to November 2007 and nega tive and significant during the crisis years Decem ber 2007 to June 2009 in line with my hypothesis and consistent with the findings of Marshall et al 2012 The negative reaction is most pronounced in the eleven days event window 5 5 with a CAAR of 2 35 percent The following table 5 5 shows the stock price reaction during pre crisis crisis and post crisis periods Layoffs and shareholder wealth

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