University of Oulu

Effects of mergers & acquisitions on financial performance of USA acquiror banks

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Author: Yondo Belle, Serge1
Organizations: 1University of Oulu, Oulu Business School, Department of Finance, Finance
Format: ebook
Version: published version
Access: open
Online Access: PDF Full Text (PDF, 1.4 MB)
Persistent link: http://urn.fi/URN:NBN:fi:oulu-201606072440
Language: English
Published: Oulu : S. Yondo Belle, 2016
Publish Date: 2016-06-13
Physical Description: 57 p.
Thesis type: Master's thesis
Tutor: Kahra, Hannu
Reviewer: Joenväärä, Juha
Kahra, Hannu
Description:
This study is testing the effects of mergers & acquisitions in banking sector and provides insights about their role on financial profitability of USA bidder banks. In this paper five financial ratios are used for analysis. The ratios are return on asset(ROA) ; return on equity (ROE); earning per share (EPS) ; capital ratio (CR); liabilities/ assets ratio(L/A). Thirty banks are selected as sample for the analysis which get into mergers from 2006 to 2012. Two years pre-merger and two years post-merger data points are taken for all the thirty banks and the average are compared. We first uses accounting formulas to calculate all financial ratios and then uses R studio to complete the Wilcoxon signed rang test required for testing pre-and-post merger financial performance of banks. At 5% level of significance findings show that mergers & acquisitions have no significant impact on financial performance of acquirer banks in USA during the studied period and often they are even performing worst.
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Copyright information: © Serge Yondo Belle, 2016. This publication is copyrighted. You may download, display and print it for your own personal use. Commercial use is prohibited.