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Mergers and Acquisitions in European banking higher productivity or better synergy among business lines?

Author

Listed:
  • Rym Ayadi

  • Jean-Philippe Boussemart
  • Hervé Leleu
  • Dhafer Saidane

Abstract

This paper aims at assessing the extent to which M&As in European banking sector over the period 1996–2003 result in two simultaneous catching up and convergence processes of consolidating groups. First, do the M&As significantly contribute to the consolidating banks to catch-up with the productivity benchmark? Second, in terms of synergies or complementarities among business lines, is there a convergence process of output mixes among the individual banks of the M&A operations? Our sample is made up of 42 M&A transactions and 587 non-merging banks in Europe. The main conclusion is that M&A operations in the European banking industry appear to be essentially motivated by an objective of improving complementarities among lines of work from each component of M&As rather than increasing productivity at the merged banks. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Rym Ayadi & Jean-Philippe Boussemart & Hervé Leleu & Dhafer Saidane, 2013. "Mergers and Acquisitions in European banking higher productivity or better synergy among business lines?," Journal of Productivity Analysis, Springer, vol. 39(2), pages 165-175, April.
    • Handle: RePEc:kap:jproda:v:39:y:2013:i:2:p:165-175
    DOI: 10.1007/s11123-012-0309-8
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    References listed on IDEAS

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    Cited by:

    1. Abdussalam Aljadani & Hassen Toumi, 2019. "Causal effect of mergers and acquisitions on EU bank productivity," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-22, December.
    2. Bushra A Abdulwahab & Subhadra Ganguli, 2017. "The Impact of Mergers and Acquisitions on Financial Performance of Banks in the Kingdom of Bahrain during 2004-15," Information Management and Business Review, AMH International, vol. 9(4), pages 34-45.
    3. Ning Zhu & Xiang Dai & Tomas Baležentis & Dalia Streimikiene & Zhiyang Shen, 2022. "Estimating production gains from international cooperation: Evidence from countries along the Belt and Road," Economic Change and Restructuring, Springer, vol. 55(2), pages 715-736, May.
    4. Steven E. Kozlowski & M. Kabir Hassan & José Antonio Pérez-Amuedo & Michael R. Puleo, 2024. "Merger reasons and their impact: Evidence from the credit union industry," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 48(4), pages 1020-1052, December.
    5. Bettie Mpundu & Norman Kachamba, 2024. "An Evaluation of the Impact of Merger and Acquisition on the Financial Health of Banks: A Case Study of Atlas Mara Bank – Zambia," African Journal of Commercial Studies, African Journal of Commercial Studies, vol. 4(4).
    6. Édouard Fernandez-Bollo & Desislava Andreeva & Maciej Grodzicki & Lise Handal & Rose Portier, 2021. "Euro area bank profitability and consolidation," Financial Stability Review, Banco de España, issue Spring.
    7. Édouard Fernandez-Bollo & Desislava Andreeva & Maciej Grodzicki & Lise Handal & Rose Portier, 2021. "Euro area bank profitability and consolidation," Financial Stability Review, Banco de España, issue Spring.
    8. López-Torres, Laura & Prior, Diego, 2022. "Long-term efficiency of public service provision in a context of budget restrictions. An application to the education sector," Socio-Economic Planning Sciences, Elsevier, vol. 81(C).
    9. Michal Jurek, 2014. "Role and impact of different types of financial institutions on economic performance and stability of the real sector in selected EU member states," Working papers wpaper36, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    10. Guccio, Calogero & Martorana, Marco & Monaco, Luisa, 2013. "Evaluating italian university teaching efficiency convergence: a non-parametric frontier approach," MPRA Paper 56673, University Library of Munich, Germany.
    11. Yiannis Anagnostopoulos & George Alexandrou & Hardy M. Thomas, 2024. "European banking M&As: The role of financial advisors," Review of Quantitative Finance and Accounting, Springer, vol. 63(4), pages 1193-1231, November.
    12. Du, Kai & Sim, Nicholas, 2016. "Mergers, acquisitions, and bank efficiency: Cross-country evidence from emerging markets," Research in International Business and Finance, Elsevier, vol. 36(C), pages 499-510.
    13. Małgorzata Zaleska & Edyta Cegielska & Emil Ślązak, 2020. "Employment in the banking sector in Poland – determinants and perception," Bank i Kredyt, Narodowy Bank Polski, vol. 51(6), pages 661-686.
    14. Calogero Guccio & Marco Ferdinando Martorana & Luisa Monaco, 2016. "Evaluating the impact of the Bologna Process on the efficiency convergence of Italian universities: a non-parametric frontier approach," Journal of Productivity Analysis, Springer, vol. 45(3), pages 275-298, June.
    15. Calogero Guccio & Marco Ferdinando Martorana & Isidoro Mazza, 2016. "Efficiency assessment and convergence in teaching and research in Italian public universities," Scientometrics, Springer;Akadémiai Kiadó, vol. 107(3), pages 1063-1094, June.

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    Keywords

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    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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