Loan moratorium announcements and stock market reaction : an event study analysis
Loan moratoriums have been a crucial lifeline defence for many borrowers during the unprecedented COVID-19 pandemic. Despite the massive amount of funds allocated to support affected borrowers, the impact on banks remains unexplored. This study aims to examine the impact of the loan moratorium annou...
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| Format: | Article |
| Language: | English |
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Penerbit Universiti Kebangsaan Malaysia
2022
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| Online Access: | http://journalarticle.ukm.my/21077/ http://journalarticle.ukm.my/21077/1/55107-200160-3-PB.pdf |
| _version_ | 1848815266089140224 |
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| author | Edie Johari, |
| author_facet | Edie Johari, |
| author_sort | Edie Johari, |
| building | UKM Institutional Repository |
| collection | Online Access |
| description | Loan moratoriums have been a crucial lifeline defence for many borrowers during the unprecedented COVID-19 pandemic. Despite the massive amount of funds allocated to support affected borrowers, the impact on banks remains unexplored. This study aims to examine the impact of the loan moratorium announcements on Malaysian banks’ stocks. Utilising an event study methodology, this study shows that bank investors reacted differently to different types of loan moratoriums. Bank investors positively valued moratoriums that did not waive accrued interest and covered a broader group of borrowers. This study suggests that while moratoriums must be given to borrowers during difficult times, the financial interests of banks should also be considered. Hence, loan moratoriums should feature accrued interest payments to ensure the banks’ prospects remain stable from the investors’ perspective |
| first_indexed | 2025-11-15T00:47:14Z |
| format | Article |
| id | oai:generic.eprints.org:21077 |
| institution | Universiti Kebangasaan Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T00:47:14Z |
| publishDate | 2022 |
| publisher | Penerbit Universiti Kebangsaan Malaysia |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | oai:generic.eprints.org:210772023-02-09T05:37:53Z http://journalarticle.ukm.my/21077/ Loan moratorium announcements and stock market reaction : an event study analysis Edie Johari, Loan moratoriums have been a crucial lifeline defence for many borrowers during the unprecedented COVID-19 pandemic. Despite the massive amount of funds allocated to support affected borrowers, the impact on banks remains unexplored. This study aims to examine the impact of the loan moratorium announcements on Malaysian banks’ stocks. Utilising an event study methodology, this study shows that bank investors reacted differently to different types of loan moratoriums. Bank investors positively valued moratoriums that did not waive accrued interest and covered a broader group of borrowers. This study suggests that while moratoriums must be given to borrowers during difficult times, the financial interests of banks should also be considered. Hence, loan moratoriums should feature accrued interest payments to ensure the banks’ prospects remain stable from the investors’ perspective Penerbit Universiti Kebangsaan Malaysia 2022 Article PeerReviewed application/pdf en http://journalarticle.ukm.my/21077/1/55107-200160-3-PB.pdf Edie Johari, (2022) Loan moratorium announcements and stock market reaction : an event study analysis. Jurnal Pengurusan, 66 . pp. 3-14. ISSN 0127-2713 https://ejournal.ukm.my/pengurusan/issue/view/1569 |
| spellingShingle | Edie Johari, Loan moratorium announcements and stock market reaction : an event study analysis |
| title | Loan moratorium announcements and stock market reaction : an event study analysis |
| title_full | Loan moratorium announcements and stock market reaction : an event study analysis |
| title_fullStr | Loan moratorium announcements and stock market reaction : an event study analysis |
| title_full_unstemmed | Loan moratorium announcements and stock market reaction : an event study analysis |
| title_short | Loan moratorium announcements and stock market reaction : an event study analysis |
| title_sort | loan moratorium announcements and stock market reaction : an event study analysis |
| url | http://journalarticle.ukm.my/21077/ http://journalarticle.ukm.my/21077/ http://journalarticle.ukm.my/21077/1/55107-200160-3-PB.pdf |