Using a unique dataset including all rights issues of new shares and other equity-like securities announced by Italian listed banks between 1989 and 2014, and exploiting the ideal setting provided by the Italian Banking Law, which allows for listed co-operative banks, we test if the ‘one head-one vote’ principle of co-operative banks and the ‘one share-one vote’ voting system of joint stock banks imply different costs of equity. Our empirical results, obtained using an event-study methodology, regressions and matching estimators, support our research hypothesis that the one head-one vote principle makes it more difficult raising new capital compared to one share-one vote principle, and contribute to the literature on demutualization and cooperative hybrids.
Security-voting structure and equity financing in the banking sector: ‘one head-one vote’ versus ‘one share-one vote’ / Ferretti R.; Pattitoni P.; Castelli A.. - In: THE JOURNAL OF MANAGEMENT AND GOVERNANCE. - ISSN 1385-3457. - STAMPA. - 23:4(2019), pp. 1063-1097. [10.1007/s10997-019-09451-7]
Security-voting structure and equity financing in the banking sector: ‘one head-one vote’ versus ‘one share-one vote’
Pattitoni P.;
2019
Abstract
Using a unique dataset including all rights issues of new shares and other equity-like securities announced by Italian listed banks between 1989 and 2014, and exploiting the ideal setting provided by the Italian Banking Law, which allows for listed co-operative banks, we test if the ‘one head-one vote’ principle of co-operative banks and the ‘one share-one vote’ voting system of joint stock banks imply different costs of equity. Our empirical results, obtained using an event-study methodology, regressions and matching estimators, support our research hypothesis that the one head-one vote principle makes it more difficult raising new capital compared to one share-one vote principle, and contribute to the literature on demutualization and cooperative hybrids.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.