Pairwise X-efficiency combinations of merging banks: analysis of the fifth merger wave

Pairwise X-efficiency combinations of merging banks: analysis of the fifth merger wave Using the non-parametric data envelopment approach, the long-run profit efficiency of nine pre-classified merger deals of merging and non-merging U.S. banks is investigated during the period from 1992 to 2003 for a sample of 359 merger deals. The findings show that, in general, large acquirers have and maintain higher efficiency scores than targets and non-merging banks. The results also show that merger deals that match least efficient acquirers with the least efficient targets could improve their profit efficiency 4 years following the merger event, which is different than all other merger deals. Finally, value-maximizing mergers are determined to be mostly large and match banks with clear opportunities to increase their future efficiency rankings. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Quantitative Finance and Accounting Springer Journals

Pairwise X-efficiency combinations of merging banks: analysis of the fifth merger wave

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Publisher
Springer US
Copyright
Copyright © 2012 by Springer Science+Business Media, LLC
Subject
Economics / Management Science; Finance/Investment/Banking; Accounting/Auditing; Econometrics; Operations Research/Decision Theory
ISSN
0924-865X
eISSN
1573-7179
D.O.I.
10.1007/s11156-012-0298-8
Publisher site
See Article on Publisher Site

Abstract

Using the non-parametric data envelopment approach, the long-run profit efficiency of nine pre-classified merger deals of merging and non-merging U.S. banks is investigated during the period from 1992 to 2003 for a sample of 359 merger deals. The findings show that, in general, large acquirers have and maintain higher efficiency scores than targets and non-merging banks. The results also show that merger deals that match least efficient acquirers with the least efficient targets could improve their profit efficiency 4 years following the merger event, which is different than all other merger deals. Finally, value-maximizing mergers are determined to be mostly large and match banks with clear opportunities to increase their future efficiency rankings.

Journal

Review of Quantitative Finance and AccountingSpringer Journals

Published: Jun 20, 2012

References

  • How to identify targets in the M&A banking operations? Case of cross-border strategies in Europe by line of activity
    Ben Slama, M; Saidane, D; Fedhila, H

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