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COVID-19 and policy responses : Early evidence in banks and FinTech stocks
Kakhkharov, Jakhongir Bianchi, Robert
Kakhkharov, Jakhongir
Bianchi, Robert
Abstract
The Australian government and Reserve Bank of Australia responded to challenges posed by the COVID-19 pandemic with a number of rapid interventions within a short period of time in early to mid-2020. We examine the impact of news relating to COVID-19, monetary policy interventions, containment measures, and the unwinding of restrictions on Australian bank and FinTech stock prices. The global pandemic was caused by factors outside the banking sector and capital markets, therefore, the policy responses from this unique crisis provides us with new knowledge. Bank and FinTech stock prices were more sensitive to the government's macroeconomic announcements and the unwinding of containment measures than to monetary policy interventions in this unique environment. The response of banks and FinTechs to COVID-19 related macroeconomic decisions is consistent with the response of bank stock prices in previous financial crises. This finding suggests a stronger emphasis on macroeconomic announcements is required as a stabilizing policy tool when managing future crises from outside the banking and capital market sectors.
Keywords
COVID-19, crisis, event studies, banks, FinTech, monetary policy
Date
2022
Type
Journal article
Journal
Pacific-Basin Finance Journal
Book
Volume
74
Issue
Page Range
1-22
Article Number
Article 101815
ACU Department
Peter Faber Business School
Faculty of Law and Business
Faculty of Law and Business
Collections
Relation URI
Source URL
Event URL
Open Access Status
License
All rights reserved
File Access
Controlled