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An Insight into Banking Sector Mergers and Acquisition-BRICS Nations

Author

Listed:
  • Sushant Sant

    (Indian Institute of Management Shillong, Shillong, Meghalaya, India)

  • Mousumi Bhattacharya

    (Indian Institute of Management Shillong, Shillong, Meghalaya, India)

Abstract

The banking and financial services (BFSI) sector is one of the most crucial areas in any economy. It is fastest growing and the listed players in this space has given high returns to the investors over the last decade. Commercial banks in the Indian context have witnessed radical changes in terms of enormous progression in off-balance sheet risk management of financial assets, regulatory amendments, NPA recognition norms, significant consolidation of the financial sector and introduction of e-commerce norms and online banking. In this context, Indian economy is similar to the other economies of BRICS countries. These countries are emerging economies with higher GDPs and undertaking various reforms to boost the consumption, transparency and business needs. So, it is pertinent to evaluate the M&A activities that have taken in India and other BRICS countries and comparing the same. This paper analyses the M&A that have taken place in India and other BRICS countries based on certain fundamental parameters which are based on regulatory requirements, profitability and overall returns on investments. The results of these tests indicate that there is insignificant change in most of parameters during post-merger phase. Further, other parameters showed a negative effect of merger on acquirer during post-merger period.

Suggested Citation

  • Sushant Sant & Mousumi Bhattacharya, 2020. "An Insight into Banking Sector Mergers and Acquisition-BRICS Nations," International Journal of Economics and Financial Issues, Econjournals, vol. 10(5), pages 37-48.
    • Handle: RePEc:eco:journ1:2020-05-5
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    References listed on IDEAS

    as
    1. Madan Mohan Dutta & Suman Kumar Dawn, 2012. "Mergers and Acquisitions in Indian Banks after Liberalisation: An Analysis," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 3(1), pages 108-114, January.
    2. V K Shobhana & N Deepa, 2012. "Impact of Mergers and Acquisitions on the Shareholder Wealth of the Select Acquirer Banks in India: An Event Study Approach," The IUP Journal of Bank Management, IUP Publications, vol. 0(2), pages 26-31, May.
    3. K. Ramakrishnan, 2010. "Redistribution of wealth on merger announcements in India," Management Research Review, Emerald Group Publishing Limited, vol. 33(8), pages 798-810, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Mergers and Acquisitions; BRICS; Financial Performance; Banking Sector;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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