The financial regulatory structure in the U.S. is complex, consisting of multiple agencies with overlapping responsibilities. Regulators have raised concerns that regulatory fragmentation may undermine the stability and efficiency of the U.S. financial system (GAO 2016). In this paper, we suggest that fragmented securities regulation increases information asymmetries and the costs of searching filed documents and thus negatively affects capital markets. Specifically, we examine the consequences of separate disclosure systems due to regulatory fragmentation on stock price efficiency.
Publicly traded banks without a bank holding company (hereinafter stand-alone banks) in the U.S. are exempt from Securities and Exchange Commission (SEC) … Read more