Title

THE IMPACT of TERRORISM on TURKISH BANKS' STOCKS and CROSS-BANK VARIATION of ABNORMAL RETURNS

Source of Publication

Global Economy Journal

Abstract

© 2020 World Scientific Publishing Company. This paper investigates the impact of the recent terrorist attacks on the Turkish banking sector. Specifically, an event study analysis is executed to estimate the abnormal returns of banks' stocks in Turkey. According to the results, negative and significant abnormal returns were observed on the event dates of terrorist attacks, those of which especially occurred at international points and touristic places. The study continues with a regression analysis that looks into the cross-bank variation of abnormal returns by using important bank characteristics as predictors. The regression analysis exhibits that banks with higher leverage and larger size are prone to getting more negatively affected by the terrorist attack. On the other hand, banks with higher liquidity and higher income level are likely to have less negative abnormal returns.

Document Type

Article

Publication Date

6-1-2020

DOI

10.1142/S2194565920500116

Author First name, Last name, Institution

E. D.A. Orhun, Zayed University

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