The Stock Market Performance of the Central Banks of Belgium and Japan

Posted: 30 Nov 2001

See all articles by Rezaul Kabir

Rezaul Kabir

University of Twente

Lawrence G. Goldberg

University of Miami - Department of Finance

Multiple version iconThere are 2 versions of this paper

Abstract

Most central banks issue stock that is held by the government and/or commercial banks and is not tradable. In contrast, stocks of the central banks of Belgium and Japan are traded on the Brussels and Tokyo stock exchanges. The purpose of the paper is to examine this unique phenomenon of stock market valuation of central banks. Our analysis shows that shares of these two central banks have performed poorly. We also investigate the factors affecting central bank stock returns and find that the stock market return is the only statistically significant determinant. Neither the assets held by the central bank nor the country's macroeconomic factors show strong and stable relationships with central bank stock returns. An event study using recent data from Japan shows that the effect of certain macroeconomic events on the value of the Bank of Japan stock is statistically insignificant.

Keywords: Central bank, stock market, long-run performance

JEL Classification: E58, G20, N20

Suggested Citation

Kabir, Rezaul and Goldberg, Lawrence G., The Stock Market Performance of the Central Banks of Belgium and Japan. Available at SSRN: https://ssrn.com/abstract=292270

Rezaul Kabir (Contact Author)

University of Twente ( email )

Faculty of Behavioral, Management & Social Science
P. O. Box 217
Enschede, 7500 AE
Netherlands
+31 53 489 5355 (Phone)

Lawrence G. Goldberg

University of Miami - Department of Finance

P.O. Box 248094
Coral Gables, FL 33124-6552
United States

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