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THE INTEGRATION OF EUROPEAN STOCK MARKETS: THE CASE OF THE BANKS
Author(s) -
Forbes Wiliam P.
Publication year - 1993
Publication title -
journal of business finance and accounting
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.282
H-Index - 77
eISSN - 1468-5957
pISSN - 0306-686X
DOI - 10.1111/j.1468-5957.1993.tb00266.x
Subject(s) - directive , deregulation , market integration , business , stock (firearms) , convergence (economics) , stock market , capital market , member states , european union , economics , financial system , finance , international trade , market economy , macroeconomics , geography , context (archaeology) , archaeology , computer science , programming language
This paper presents an analysis of the degree of integration in the security market for European banks' stock using daily data for the period 30th November, 1987‐28th October, 1988. In particular we study eight banks located in four European states, Germany, the Netherlands, Switzerland and the United Kingdom. Some degree of integration might be expected to be present as a consequence of a common regulatory regime incorporated in the Second European Banking Directive and common capital adequacy requirements. We find strong evidence that a high degree of integration does exist, at least amongst EC states. This suggests that the benefits claimed for capital market deregulation, with its associated ‘convergence criteria’ requirements, may already be being enjoyed by EC states.