Post-merger strategy and performance: evidence from the US and European banking industries
AbstractThe banking industry has one of the most active markets for mergers and acquisitions. However, little is known about the type of operational strategies adopted by banking firms in the years following a deal. For a sample of bidding banks in the USA and Europe, this study compares the design and performance implications of different post-merger strategies in both geographical regions. Using accounting data, we show that European banks pursue a cost-cutting strategy by increasing efficiency levels vis-à-vis non-merging banks and by cutting back on both labour costs and lending activities. US banks, on the other hand, raise both interest and non-interest income in the post-merger period. Copyright (c) The Authors. Journal compilation (c) 2009 AFAANZ.
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Bibliographic InfoArticle provided by Accounting and Finance Association of Australia and New Zealand in its journal Accounting & Finance.
Volume (Year): 49 (2009)
Issue (Month): 4 ()
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0810-5391
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- Jens Hagendorff & Maria J. Nieto & Larry D. Wall, 2012. "The safety and soundness effects of bank M&A in the EU," Working Paper 2012-13, Federal Reserve Bank of Atlanta.
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- Pérez Montes, Carlos, 2014. "The effect on competition of banking sector consolidation following the financial crisis of 2008," Journal of Banking & Finance, Elsevier, vol. 43(C), pages 124-136.
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