How Do Stock Markets in the US and Europe Price Efficiency Gains from Bank M&amp;As?

Chronopoulos, Dimitris K.; Girardone, Claudia; Nankervis, John C.

doi:10.1007/s10693-012-0132-4

Cited by 22 publications

(14 citation statements)

References 71 publications

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“…They found that the impact of the M&A on a company's value was negative, caused by some reasons as agency problems and integration cost. However, Chronopoulos et al (2013) examined the determinants of profitability for a large sample of US banks from 1984 to 2010. They concluded that the competitive process reduced the abnormal return and regulatory changes in the 1990s, which affected both level and persistence of bank profitability, as the 2007-2010 financial crisis led to an increase in the persistence of bank profitability.…”

Section: Literature Review On Manda/banking Relation Efficiencymentioning

confidence: 99%

“…The technology has accelerated the pace of the M&A. Rani et al (2014) and Chronopoulos et al (2013) found that the M&A had a positive impact on the performance of banks. In addition, El-Chaarani (2014) examined the impact of corporate governance on the financial performance of Lebanese banks, from 2006 to 2010, based on 182 observations.…”

Section: Literature Review On Manda/banking Relation Efficiencymentioning

confidence: 99%

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Dynamic Effects of Mergers and Acquisitions on the Performance of Commercial European Banks

Toumi

Issaoui

Ammouri³

et al. 2016

J Knowl Econ

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In this paper, we have shown that the operations of Mergers and Acquisitions (M&A) are necessary for the growth of banks and for passing to increase the scale of returns. The empirical results have confirmed this affirmation. The time has had a negative effect on efficiency while the dummy M&A variable has had positive effects. The composite mergers-time variable has had positive effects, which means that in the long run the M&A achieve all their aims. Our study, therefore, is the first to analyze the dynamic effects of mergers on bank performance derived from both the acquisition of another bank and time, using panel data methodology, for the period 2005-2013, in a sample of 60 acquire banks, in 17 European countries.

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Section: Literature Review On Manda/banking Relation Efficiencymentioning

confidence: 99%

Section: Literature Review On Manda/banking Relation Efficiencymentioning

confidence: 99%

Dynamic Effects of Mergers and Acquisitions on the Performance of Commercial European Banks

Toumi

Issaoui

Ammouri³

et al. 2016

J Knowl Econ

View full text Add to dashboard Cite

show abstract

“…The study of the dynamics of share prices assumes even more importance in times of crisis of confidence, uncertainty and high market volatility (Brana & Prat, 2016;Küçükkocaoğlua et al, 2013;Chronopoulos et al, 2013). The price of a share is affected, to an extent and with differing intensity, by all the variables that determine its supply and demand.…”

Section: Literature Reviewmentioning

confidence: 99%

What Influences Bank Stock Prices in Times of Crisis? An International Survey

Pacelli¹

2017

IJEF

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The paper assesses whether the European banks' stock prices are predicted or affected by changes in balance-sheet indicators and macroeconomic variables. The sample covers the time period from January 2007 to December 2013. Estimates use the multiple regression model based on the weighted least squares (WLS) estimator. Results show that the stock prices of European banks are positively related to asset quality, liquidity and banks' capital ratios. However, in the same period, inflation rate and public debt exert a negative and significant effect on bank stock prices. Our findings are more significant in times of high market turbulence as have been experienced for almost a decade. These have provoked the investors' perceptions to be more unstable and volatile. The availability of information remains limited and poor. Therefore, it is necessary to emphasize that identifying the causal determinants of stock prices in the markets could generate important practical and policy implications because of the role played by banks in financing the economic system, and will also attract investors (Note 1).

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“…The efficiency concept is better understood through the lens of Stochastic Frontier Analysis (SFA) and Data Envelopment Analysis (DEA) to analyse the relation between post-acquisition performance and banks' position at the efficiency frontier, and to compare the efficiency gains related to certain bank criteria, for example bank size and size of the merger [5,6,25]. Al-Sharkas et al [6] find significant improvement in profit efficiency for both large and small bank mergers through using non-standard profit efficiency model.…”

Section: The Impacts Of Mandas On Us Banking Industry: a Review Of Mementioning

confidence: 99%

“…Cornett and Tehranian [21] find a significant correlation between announcement period abnormal returns and operational performance measured by various accounting ratios, which indicates that the market participants are able to identify in advance the improvements in merged bank performance. Chronopoulos et al [25] examine the relation between changes in cost and profit efficiency and the announcement-period abnormal returns. They find a positive relation between change in profit efficiency and acquirer's CARs, which indicates that market participants are able to identify merger-related profit efficiency gains upon merger announcement, while the relation between change in cost efficiency and the acquirer's CARs is not statistically significant.…”

Section: The Impacts Of Mandas On Us Banking Industry: a Review Of Mementioning

confidence: 99%

Are All Bank Acquisitions Equal? The Impact of Bank Mergers and Acquisitions around the 2007-2009 Financial Crisis: Evidence from TARP

King¹,

Kong²

2016

J Account Mark

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The large wave of bank mergers, which had affected the US bank sector in the years leading 2007-2009 crisis, experienced a sudden decline in both volume and value in the post-financial crisis period. This study examines whether TARP banks, i.e. banks that received government financial support during the recent 2007-2009 crisis, differed in terms of M&A financial performance outcomes in the pre and post financial crisis periods compared to non-TARP recipients. We find significant and differences in the post-merger financial performance of TARP recipients compared to non-TARP recipients in the post financial crisis period but no significant differences in their pre-merger performance. Our results infer differences in merger motivations for TARP and non-TARP banks.

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How Do Stock Markets in the US and Europe Price Efficiency Gains from Bank M&As?

Cited by 22 publications

References 71 publications

Dynamic Effects of Mergers and Acquisitions on the Performance of Commercial European Banks

Dynamic Effects of Mergers and Acquisitions on the Performance of Commercial European Banks

What Influences Bank Stock Prices in Times of Crisis? An International Survey

Are All Bank Acquisitions Equal? The Impact of Bank Mergers and Acquisitions around the 2007-2009 Financial Crisis: Evidence from TARP

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