Abstract
In this study, we would be interested in knowing how commercial banks use derivatives and analyze its effect on the firm vale in Korea. We find that the derivatives transaction by banks increases during the analysis period and that banks use the derivatives mostly for speculation rather than hedging. Foreign exchange risk is mostly concerned for the purpose of risk hedging, and forward and/or futures are preferred to other derivatives such as option or swap. We also find that the usage of derivatives has a positive effect on the firm value of Korean commercial banks.
Keywords
Citation
Kwon, T.H., Park, R.S. and Chang, U. (2013), "The Effect of Derivatives Usage of Korean Commercial Banks on Their Firm Value", Journal of Derivatives and Quantitative Studies: 선물연구, Vol. 21 No. 3, pp. 331-351. https://doi.org/10.1108/JDQS-03-2013-B0004
Publisher
:Emerald Publishing Limited
Copyright © 2013 Emerald Publishing Limited
License
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