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Review of Quantitative Finance and Accounting

, Volume 36, Issue 1, pp 33–55 | Cite as

Value relevance of banks: global evidence

  • Asokan Anandarajan
  • Bill Francis
  • Iftekhar Hasan
  • Kose JohnEmail author
Original Research

Abstract

Using 28,785 observations of 813 banking institutions in 38 countries during the 1993–2004 period, this study investigates among others, the role of transparency, accounting standards, legal, financing, corporate, and banking environments at the country level and size, risk, and organization form at the bank-specific level affecting the extent of value relevance. The evidence indicates that at the macro-level, the extent of mandated accounting disclosure, differences in accounting measurement practices, and type of legal environment, were the most influencing factors affecting the extent of value relevance of earnings and book values. At the bank-level, the organizational form and risk had the most impact.

Keywords

Value relevance Equity valuation Earnings Book values 

JEL Classification

M41 

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Copyright information

© Springer Science+Business Media, LLC 2010

Authors and Affiliations

  • Asokan Anandarajan
    • 1
  • Bill Francis
    • 2
  • Iftekhar Hasan
    • 3
  • Kose John
    • 4
    Email author
  1. 1.New Jersey Institute of TechnologyNewarkUSA
  2. 2.Lally School of ManagementRensselaer Polytechnic InstituteTroyUSA
  3. 3.Rensselaer Polytechnic Institute and Bank of FinlandTroyUSA
  4. 4.Finance Department, Stern School of BusinessNew York UniversityNew YorkUSA

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