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The Role of Bank‐Affiliated Venture Capital for Parent Banks in Japan: New Evidence
Author(s) -
Sun Yue,
Uchida Konari
Publication year - 2016
Publication title -
asia‐pacific journal of financial studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.375
H-Index - 15
eISSN - 2041-6156
pISSN - 2041-9945
DOI - 10.1111/ajfs.12155
Subject(s) - initial public offering , business , explanatory power , venture capital , loan , financial system , exit strategy , finance , monetary economics , economics , marketing , philosophy , epistemology
After controlling for the effect of parent banks’ ( PB s) direct ownership, we find that investment by bank‐affiliated venture capitals ( BVC s) is positively associated with the probability that investee firms have loan balances with PB s in the year they issue an IPO . However, BVC s typically sell off their holdings of investee firms within 2 years after the IPO . Furthermore, the level of BVC ownership does not have explanatory power regarding whether investee firms have loans from PB s. On the contrary, PB s’ direct shareholdings have a positive association with the probability that investee firms have PB loans for many years after IPO s.

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