It can be concluded that there are various advantages
of merger and acquisition in banking sector like increase in customer base,
increase in branches , increase in number of product  and service offered,  increase in number of ATM network, increase
in number of employees , benefits of expertise employees , access to various
region in the country, increase in deposit and advance amount. There are also
various challenges like difference in deposit rate and interest rate,
difficulty in managing nonperforming assets, difficulty in managing the
employees because difference in salary structure, etc. after analysis post-merger
financial performance we can say that after merger and acquisition, there is
increase in net interest income, increase in profitability, increase in number
of customers, improve liquidity, share price has been increased.

Conclusion

ü  Increase ATM network in the country

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ü  Access to international business

ü  Increase in deposit and advances

ü  Increase in customer base

ü  Increase in branch network

ü  Economies of scale

 Strategies Adopted (SYNERGIES FROM MERGER)

 This research aims to analysis of merger and
acquisition in banking sector in India. This paper also looks into the
challenges and problems related to merger and acquisition in India, post-merger
analysis of financial performance and post-merger analysis of number customer
bases and network. This research has used descriptive
research design. The source of data collections used is secondary data.
The data has been collected from the published financial statements by the
company’s in their annual reports. Sample size of the research is that of Merger of kotak
Mahindra bank and ING vyas bank.

In the last few
years, India had witnessed a substantial hike in the mergers and acquisitions
(“M&A”) activity. Many can expect the increase in the M deals in
India as both the foreign investors and local investors are seeing India
towards a great tremendous growth in the sector. With regards to mergers and
acquisitions in the managing an account division, it can be figured that size does
make a difference and development in size can be accomplished through mergers
and acquisitions effectively.

Journal:
International Journal of Advance Research
in Computer Science and Management Studies Year: 2016

Article : Merger
and Acquisition in Banking Sector

The
main reason why organizations and mostly within the Kenyan banking industry
merge and/or acquire others, is to enlarge their market share and increase
their profitability. This is achieved through two or more banks coming
together, combining their resources together with one schedule to raise their
profitability. Such resources as skills, management systems, equipment,
processes and procedures are strengthened through the mergers and acquisitions
with an aim of raising their productivity.

Conclusion

The
findings of this study revealed that majority of the banks i.e. 42% merged or
acquired other banks between 4 and 7 years ago. The recent mergers i.e. those
that are below 4 years since they merged accounted for only 20% of all the
mergers and acquisitions in the banking sector. The banks that merged or acquired for the purpose of
enlarging their market share and raise their profitability accounted for about
76% of all the mergers and acquisitions in the banking industry in Kenya.  The study further established that the
mergers and acquisitions among the banks in Kenya raised the shareholder’s
value through raising the demand, price and earnings per share. However, the
mergers and acquisitions did not have a significant effect on the amount of
dividends declared to the shareholders and the frequency of issuing dividends.

The
study used descriptive survey design. The population of this study was comprised of all the
14 banks that had merged or acquired in Kenya since year 2000 to the time of
study. Data was collected by use of questionnaires with both open and closed
ended questions. The collected data was analyzed using SPSS where the
co-efficient of correlation obtained was used to determine the nature of the
relationship between the independent and dependent variables. The analyzed data was presented by use of percentages,
frequency tables, graphs and pie charts.

This
research was done to analyze whether the merger had any effect on the banks’
performance .The research aims to determine the effect of the mergers and
acquisitions on the shareholders’ value and to examine the implication of
mergers and acquisitions on profitability. The variable used in the study was
dependent, independent and moderating variable. 
The dependent variable was ROE, independent were EPS and ROI and moderating
variable was set rules and regulations.

The
act of mergers and acquisitions has accomplished extensive essentialness in the
contemporary corporate situation which is comprehensively utilized for
revamping the business elements. Merger and Acquisition has been recognized as
the most important factor in corporate finance for companies as well as the
economy. The M&A have not been the booming scenario in the Kenya as
compared to other African countries. Earlier research has shown no advancement
or improvement in the country performance and profitability. And it has a
direct impact on the crucial financial component in the country i.e. banks.

Year: 2015

Journal:
International
Journal of Innovative Research and Development

Article
: The Effect of Mergers and Acquisitions on Financial Performance of Banks (A
Survey of Commercial Banks in Kenya)

 

The
major findings included the evaluated analysis of the financial ratios of the
OJSC RUSAL and UC RUSAL. Secondly, the fair value of the company based on
market multiples was assessed. Besides, the market multipliers performance is trailed
within the company perspective and aluminum industry. Finally, the estimation
of the impact of merger on the stock performance of the companies – rivals of
OJSC RUSAL and UC RUSAL within aluminum industry was measured. The study
concluded with suggestions of the significant factors of a particular
transaction in order to lay down basics of integration strategy and management
decision making.

A
descriptive research design was followed in the study. The design concerned
with the definition of corporate performance in terms of M&A deals in
Russia. Thus, to reinforce the results, the research included an overview of
the aluminum industry identifying the pre – and post – merger company position.

The
Russian market of mergers and acquisitions has strengthened over the recent
decade. One of the most significant consolidations on the Russian market was
the merger of Russian aluminum giants, i.e. RUSAL and SUAL, and Swiss company
Glencore which was supposed to create an international diversified metallurgy
corporation. In light of the same, the article predicts the success of the deal
and, in turn, the world aluminum market performance.

This
article focuses on the merger in the aluminum industry in Russia. Besides the
practical issue connected with the optimization of the united resources, the
overall effect of merger has not efficiently impacted the corporate
performance, which on surface forms the research gap for this paper. Thus, this
research analyses the multi-faceted impact of the merger on the corporate
performance. It also provides an overview of the stock prices on the companies
operating within the aluminum industry to demonstrate the general impact of the
merger.

 

Article
:The Impact of Mergers and Acquisitions on corporate performance (The Russian
Aluminum Industry Case)

 

 

 

The performance of Banks in Pakistan has shown a gradual
increase with the motive of expanding globally. One can expect
the increase in the M&A deals in India as both the foreign investors and
local investors are seeing India towards a great tremendous growth in the
sector. Banks plays a crucial role in the advancement of economy of Pakistan as
they are the important part of the financial system of the country.

Future Implication

ü  Consolidation

Strategy
Adopted                                                                                 

The
analysis findings were that
merger of My Bank restricted
with Summit Bank restricted was more practical in most of the
variables as compared to the merger of PICIC bank restricted
with National Investment Bank restricted,
Union Bank restricted with normal hired Bank restricted,
JS investment Bank restricted
with JS Bank restricted and
Askari Leasing restricted with
Askari Bank restricted. 5 bank merger’s cases are taken and Null Hypothesis (there isn’t any distinction within the
norm of elect variables before and when
the merger) is found rejected.

This research aims to assess the effectiveness and importance
of merger and acquisition of the merged banks before and after merger and acquisition.
The source of data collection used in the study is of secondary source. The
sample size of the research has been selected on the basis of uniformity and
availability. The period of collection of data for the sample was collected per
and post 4 years of the mergers amongst the banks. The different variable used
in the study were capital , deposits , advances , investments , Total assets ,
fixed assets , interest earned , interest expenditure , total income , total
expenditure  and net profit .The data
analysis tools and techniques used in the research were ” t – test” and mean .
The “t” test has been used at the significance level of 5% and 3 degrees of
freedom to analyze the significance of change in the value of mean before and
after merger.

A Merger or Acquisition is one of the most transformative
undertaken in a firm’s life cycle. Merger and Acquisition has been recognized
as the most crucial factor in corporate finance for companies as well as the
economy. Over the last decade, the banking industry in Pakistan has diversified
and combined to contribute towards constructing a strong financial system and
increased in terms of size too. Banks consolidation through Merger and
Acquisition is a new phenomenon for banking system in Pakistan.

Year:
2015

Journal:  INTERNATIONAL JOURNAL OF ECONOMICS
AND MANAGEMENT SCIENCES

Article –
Effectiveness of Pakistani Banks after Merger and Acquisition

After the merger has been done it is very important for both
the companies to make a strategy for the first 100 days and then look forward
to work upon the same. The synergy should include: operations synergy,
financial synergy, marketing synergy and manufacturing synergy

This is a positive indicator for strong future growth.
There will be a lot of synergies in the future relating in terms of sharing of
best practices across the companies. Thus
we can clearly see that the deal between TATA Steel and Corus was a very good
move. Apart from gaining access to the western markets in such a short time,
TATA was also successful in integrating the two companies perfectly. 

Future
Implication


Market
penetration into the European countries


Managerial
synergy


Increased
market power through horizontal acquisition


Global
Expansion


Retaining
the expertise of Corus management

Strategies
Adopted

 

The article shows that a merger has an impact on the firm
may be in different parameters in relation to performance, profitability,
economies of scale etc. This research analysis has proven that the merger
improved the position of Tata steel in different parameters.

The research findings show that there was a
significant difference between pre – post merger and acquisition in capital base
and level of returns. It also shows significant difference between pre – post
merger and acquisition EPS. Another finding from the research was that the
increase in the capital base because of corporate integration of Tata and Corus.

This research looks to explore the motive factors and
evaluate the impact of the deal.  Event
study approach is used to study the impact of the M& A of Tata steel and
Corus. The source of data collections used is secondary data. The data has been
collected from the published financial statements by the company’s in their
annual reports.  The variables used in
the research were profitability, performance, turnover, capacity, economies of
scale and enhanced control. The tools and techniques used in
the research were correlation co-efficient and t- test. Correlation
co-efficient and t- test were used to test the three hypotheses in the study.
The T- test is used to determine the post and prior -performance of an
activity.

In
the last few years, India had witnessed a substantial hike in the mergers and
acquisitions (“M&A”) activity. Many can expect the increase in the M&A
deals in India as both the foreign investors and local investors are seeing
India towards a great tremendous growth in the sector .This research is
entirely based on the merger and acquisition deal between the Tata steel and chorus
and getting an insight into the steel industry by making an analysis of the
deal with the help of event study approach.

Year: 2013

Journal:
IOSR Journal of
Business and Management (IOSR-JBM)

Article:  An
Analysis of the Impact of Merger and Acquisition of Corus by Tata Steel

Categories: Articles

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