The Competing Risks of Acquiring and Being Acquired: Evidence from Colombia´s Financial Sector
This paper studies the determinants of the probability of participating in a process of merging or acquisition for financial institutions in Colombia. We use survival analysis techniques and competing risks models to estimate the probability of participating in such processes as an acquiring or acquired firm. Using an especially rich database containing financial information of Colombian banks for the period 1990 - 2007, we find that both macroeconomic and microeconomic variables are important determinants of such probability. However, there are differential effects for the acquiring firm and the acquired firm. Particularly, while firm size and solvency result significant determinants of the probability of being an acquiring firm, efficiency is an important determinant of the probability of being acquired. Also, the concentration index, that plays no role for acquiring firms, plays an important role in the probability of being acquired.
|Date of creation:||16 Jun 2009|
|Contact details of provider:|| |
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Andrés Felipe García Suaza & .José Eduardo Gómez González, "undated".
"Determinantes de las fusiones y adquisiciones en el sistema financiero colombiano. 1990-2007,"
Borradores de Economia
550, Banco de la Republica de Colombia.
- Andrés Garcia & José Gomez, 2009. "Determinantes de las fusiones y adquisiciones en el sistema financiero colombiano. 1990-2007," REVISTA DE ECONOMÍA DEL ROSARIO, UNIVERSIDAD DEL ROSARIO, pages -, May.
- Andrés Felipe García Suaza & José Eduardo Gómez Gónzalez, 2009. "Determinantes de las fusiones y adquisiciones en el sistema financiero colombiano. 1990-2007," BORRADORES DE ECONOMIA 005294, BANCO DE LA REPÚBLICA.
- H.P. Huizinga & J.H.M. Nelissen & R. Vander Vennet, 2001. "Efficiency Effects of Bank Mergers and Acquisitions," Tinbergen Institute Discussion Papers 01-088/3, Tinbergen Institute.
- Rhoades, Stephen A., 1998. "The efficiency effects of bank mergers: An overview of case studies of nine mergers," Journal of Banking & Finance, Elsevier, vol. 22(3), pages 273-291, March.
- Dean F. Amel & Stephen A. Rhoades, 1989. "Empirical Evidence on the Motives for Bank Mergers," Eastern Economic Journal, Eastern Economic Association, vol. 15(1), pages 17-27, Jan-Mar.
- David C. Wheelock & Paul W. Wilson, 2000.
"Why do Banks Disappear? The Determinants of U.S. Bank Failures and Acquisitions,"
The Review of Economics and Statistics,
MIT Press, vol. 82(1), pages 127-138, February.
- David C. Wheelock & Paul W. Wilson, 1995. "Why do banks disappear? The determinants of U.S. bank failures and acquisitions," Working Papers 1995-013, Federal Reserve Bank of St. Louis.
- JosÃ© E. GÃ³mez-Gonzalez & Nicholas M. Kiefer, 2009.
"Bank Failure: Evidence From The Colombian Financial Crisis,"
The International Journal of Business and Finance Research,
The Institute for Business and Finance Research, vol. 3(2), pages 15-31.
- Gomez-Gonzalez, Jose E. & Kiefer, Nicholas M., 2006. "Bank Failure: Evidence from the Colombia Financial Crisis," Working Papers 06-12, Cornell University, Center for Analytic Economics.
- Dario Focarelli & Fabio Panetta & Carmelo Salleo, 1999. "Why Do Banks Merge?," Temi di discussione (Economic working papers) 361, Bank of Italy, Economic Research and International Relations Area.
- Hannan, Timothy H & Rhoades, Stephen A, 1987. "Acquisition Targets and Motives: The Case of the Banking Industry," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 67-74, February.
- Diaz, Belen Diaz & Olalla, Myriam Garcia & Azofra, Sergio Sanfilippo, 2004. "Bank acquisitions and performance: evidence from a panel of European credit entities," Journal of Economics and Business, Elsevier, vol. 56(5), pages 377-404.
- Joe S. Bain, 1951. "Corrigendum"Relation of Profit Rate to Industry Concentration: American Manufacturing, 1936–1940" by Joe S. Bain (August 1951)," The Quarterly Journal of Economics, Oxford University Press, vol. 65(4), pages 602-602.
- Carree, Martin A., 2003. "A hazard rate analysis of Russian commercial banks in the period 1994-1997," Economic Systems, Elsevier, vol. 27(3), pages 255-269, September.
- Levin, D., 1988.
"Horizontal Mergers: The 50 Percent Bench-Mark,"
19, Houston - Department of Economics.
- Timothy H. Hannan & Steven J. Pilloff, 2006.
"Acquisition targets and motives in the banking industry,"
Finance and Economics Discussion Series
2006-40, Board of Governors of the Federal Reserve System (U.S.).
- Timothy H. Hannan & Steven J. Pilloff, 2009. "Acquisition Targets and Motives in the Banking Industry," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 41(6), pages 1167-1187, 09.
- Focarelli, D. & Panetta, F. & Salleo, C., 1999. "Why do Banks Merge?," Papers 361, Banca Italia - Servizio di Studi.
- Jean Tirole, 2006. "The Theory of Corporate Finance," Post-Print hal-00173191, HAL.
- Joe S. Bain, 1951. "Relation of Profit Rate to Industry Concentration: American Manufacturing, 1936–1940," The Quarterly Journal of Economics, Oxford University Press, vol. 65(3), pages 293-324.
- M. Meschi, 1997. "Analytical Perspectives on Mergers and Acquisitions: A Survey," CIBS Research Papers in International Business 5-97, London South Bank University CIBS.
- Dario Focarelli & Fabio Panetta & Carmelo Salleo, 1999. "Why do banks merge? some empirical evidence from Italy," Proceedings 646, Federal Reserve Bank of Chicago.
When requesting a correction, please mention this item's handle: RePEc:col:000094:005676. 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: (Clorith Angélica Bahos Olivera)
If references are entirely missing, you can add them using this form.