Oldenburg financial researchers Prof Dr Jörg Prokop, Dr Haoshen Hu and Prof Dr Hans-Michael Trautwein received an award for an outstanding research paper at the renowned annual conference of the Eastern Finance Association.

In their paper "Transnational Spillover Effects of Sovereign Rating Signals on Bank Stock Returns: Evidence from the Euro Area", the authors investigated how changes in sovereign ratings within the EU affect the behaviour of investors on the stock market.
Based on data from major rating agencies, the researchers analysed whether changes in the ratings of one country lead to an equal or opposite reaction of bank share prices in other countries. They found cross-border spillover effects for both positive and negative rating signals. In which direction and how strongly the stock market reacts depends primarily on the rating agency from which the country rating in question originates and the economic environment in which it is published. According to the team of authors, the results indicate that country ratings are systematically relevant beyond the borders of the country being rated.