Takeshi Kobayashi

Bio: Takeshi Kobayashi is an academic researcher from Chukyo University. The author has contributed to research in topics: Reserve requirement & Interest rate. The author has an hindex of 4, co-authored 6 publications receiving 70 citations.

Do Japanese Insurers Benefit from A Catastrophic Event?: Market Reactions to the 1995 Hanshin–Awaji Earthquake

Abstract: Several studies have examined the “gaining from loss” hypothesis, whereby insurance companies' market valuation increases after a natural disaster because the anticipated subsequent increase in demand for coverage is presumed by investors to outweigh the effects of capital outflow from insurance companies for claims payments. Previous studies investigating how stock markets assessed the impact of big earthquakes in the United States (e.g., the 1989 Loma Prieta earthquake) found that insurance firm values did indeed increase following such catastrophes. This is the first paper to test this hypothesis using a case outside the United States. Specifically, we investigate how the Japanese stock market reassessed domestic insurance firm values after the 1995 Hanshin–Awaji earthquake. Contrary to the findings based on U.S. earthquakes, we found negative stock price reactions. Another important finding is that Japanese stock markets were notably efficient in assessing information following the earthquake. J. Japan. Int. Econ. , March 2002, 16 (1) pp. 92–108. Graduate School of Economics, Nagoya University, Nagoya, 464-8601, Japan and School of Economics, Chukyo University, Nagoya, 466-8666, Japan. © 2002 Elsevier Science (USA). Journal of Economic Literature Classification Numbers: G-22, G-14.

Quantitative easing and Japanese bank equity values

Abstract: One of the primary motivations offered by the Bank of Japan (BOJ) for its quantitative easing program—whereby it maintained a current account balance target in excess of required reserves, effectively pegging short-term interest rates at zero—was to maintain credit extension by the troubled Japanese financial sector. We conduct an event study concerning the anticipated impact of quantitative easing on the Japanese banking sector by examining the impact of the introduction and expansion of the policy on Japanese bank equity values. We find that excess returns of Japanese banks were greater when increases in the BOJ current account balance target were accompanied by “non-standard” expansionary policies, such as raising the ceiling on BOJ purchases of long-term Japanese government bonds. We also provide cross-sectional evidence that suggests that the market perceived that the quantitative easing program would disproportionately benefit financially weaker Japanese banks. J. Japanese Int. Economies 20 (4) (2006) 699–721.

Is It True that Insurers Benefit from a Catastrophic Event? Market Reactions to the 1995 Hanshin-Awaji Earthquake

Abstract: Previous studies, investigating how the market in general viewed the impact of a big earthquake (e.g. the 1989 Loma Prieta earthquake in the San Francisco Bay Area) on insurance firm values, found a positive reaction of insurers' stock prices. This "gaining from loss" may be caused by the subsequent increased demand for insurance coverage. This paper investigates the impact of the 1995 Hanshin-Awak=ji earthquake on Japanese insurers' value.

Preparing for Large Natural Catastrophes: The current state and challenges of earthquake insurance in Japan

Abstract: Global incidents of major natural catastrophes are becoming increasingly common in recent years. Seismological research has shown earthquake-prone Japan to be at particular risk from not only inland earthquakes, but also from repeat incidents of major earthquakes such as the Tokai, Tonankai, and Nankai earthquakes. In such an eventuality, earthquake insurance is expected to play a part in ex-post recovery efforts from the damage caused by these earthquakes, with the Japanese government developing special support programs. The previously low penetration rate of earthquake insurance in Japan, however, meant that it did not play a significant role in recovery efforts following the 1995 Great Hanshin-Awaji Earthquake. Despite recent progress in improving the system and an increasing awareness of the risks from earthquakes, the penetration rate of earthquake insurance in Japan remains at approximately 20%. In this study we discuss the current state and issues of earthquake insurance in Japan.

Quantitative Easing and Japanese Bank Equity Values

Abstract: One of the primary motivations offered by the Bank of Japan (BOJ) for its quantitative easing program - whereby it maintained a current account balance target in excess of required reserves, effectively pegging short-term interest rates at zero - was to maintain credit extension by the troubled Japanese financial sector. We conduct an event study concerning the anticipated impact of quantitative easing on the Japanese banking sector by examining the impact of the introduction and expansion of the policy on Japanese bank equity values. We find that excess returns of Japanese banks were greater when increases in the BOJ current account balance target were accompanied by "nonstandard" expansionary policies, such as raising the ceiling on BOJ purchases of longterm Japanese government bonds. We also provide cross-sectional evidence that suggests that the market perceived that the quantitative easing program would disproportionately benefit financially weaker Japanese banks.

The Impact of Natural Disasters on Stock Markets: Evidence from Japan and the US

Abstract: This paper investigates the impact of natural disasters on the insurance sector as well as on the composite stock market in Japan and the US. GARCH models are employed to capture both wealth and risk effects of natural disasters. There are no wealth effects in the US and Japan composite stock markets, indicating that these markets can well diversify away the impact of natural disasters on stock return, but there are significant wealth effects in the US and Japan insurance sectors. While US investors in the insurance sector lose, those in Japan gain. All markets except the composite stock market in Japan face risk effects of natural disasters.

The Financial Impact of IT Security Breaches: What Do Investors Think?

Abstract: Internet security is a pervasive concern for all companies. While many previous studies have attempted to quantify financial losses resulting from IT security breaches, reliance on self-reported survey data has undermined the credibility of their results. Using an event-study methodology, this article analyzes the financial impact of cyber-breaches, by measuring the stock market reaction, and reveals several new perspectives.

Stock Market Reaction to Supply Chain Disruptions from the 2011 Great East Japan Earthquake

Abstract: Problem definition: This paper provides empirical evidence on the effect of the 2011 Great East Japan Earthquake (GEJE) on the financial performance of firms. Academic/practical relevance: The GEJE...