Banks in the industrialized world are moving toward a new international capital standard. The BIS or Basle standard establishes higher levels of capital and requires increased sales of securities by Japanese banks. This study measures the stockholders' costs of selling new capital issues by 27 Japanese banks, containing the largest banks in the world. There are significant differences in the stockholders' costs of these sales from those of U.S. banks. These sales effects by Japanese banks are opposite from those suggested by many finance theories. Several explanations for these differences are presented.
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