The wealth effects of bank acquisitions
The purpose of the study is to investigate whether trends in banking mergers between January 1994 and October 1995 are different from previous periods. Specifically, the study focused on greatly increased acquisition prices and interstate consolidations. Abnormal returns and cumulative abnormal returns for a sample of 30 mergers were determined for each situation. The results of the study showed negative effects for shareholders of acquiring banks around the announcement period. Medium-to-small acquisitions, under $1 billion, caused insignificant negative abnormal returns, but large acquisitions, over $1 billion, caused significant negative abnormal returns. At the same time, shareholders in acquired banks of both sizes earned significant positive abnormal returns. The most dramatic discovery was that the larger acquisition price, the higher the target returns. The analysis of interstate mergers showed similar results. The analysis documented significant positive abnormal returns for target banks and insignificant negative abnormal returns for acquiring banks during the announcement.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 6 (1999)
Issue (Month): 1 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RAEL20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RAEL20|
When requesting a correction, please mention this item's handle: RePEc:taf:apeclt:v:6:y:1999:i:1:p:5-11. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.