Determinants of cross-listing likelihood: an investigation of financial firms in an emerging country

Purpose This study aims to investigate the critical factors influencing the likelihood of Vietnamese financial firms cross-listing on the Singapore Stock Exchange (SGX) by using the Cox proportional hazards model. Design/methodology/approach This analysis uses data spanning from 2010 to 2023, gathered from 84 Vietnamese firms in the financial sector. The Cox model is used for its flexibility in capturing the relationship between covariates and cross-listing likelihood over time. Findings The results support the capital market segmentation theory, indicating a limited correlation between the two markets. Consequently, Vietnamese financial firms are motivated to pursue cross-listings on the SGX. In addition, trading volume liquidity has a positive impact on cross-listing, consistent with the market liquidity hypothesis. The findings further unveil that foreign ownership, managerial performance, firm size and exchange rate volatility exert positive effects on the likelihood of Vietnamese financial firms being cross-listed on the SGX. Originality/value While the existing research in this field primarily focuses on businesses listed in developed markets, there is a noticeable lack of studies investigating the factors that influence the likelihood of cross-listing for businesses in an emerging country such as Vietnam. Furthermore, previous research has primarily focused on providing explanations for past cross-listing decisions, which can be viewed as observations made on the downstream outcomes rather than the upstream decision-making process. Given these considerations, this study suggests an innovative approach that prioritises prediction rather than explanation.