A Study on Pre & Post Performance Evaluation of Merger and Acquisition of Selected Indian Banks.

5904 Words Mar 7th, 2016 24 Pages
International

ISSN: 2278-6236

Journal of Advanced Research in

Management

and Social Sciences

Impact Factor: 4.400

MERGERS A N D ACQUISITIONS IN THE INDIAN BANKING SECTOR: A STUDY OF
SELECTED BANKS
Komal Gupta*

Abstract: In the present era of global economy,

Mergers

most widely used business strategy

restructuring

greater

market

economies

share,

long

term

of corporate profitability, entering

of scale etc. The present paper evaluates

on the financial is conducted

performance

and Acquisitions

have become the

and strengthening new markets,

capitalising

the effects of merger and acquisitions

to analyse the effectiveness

on the banks. Two cases of merger
…show more content…
The main rationale behind the Mergers and Acquisitions is to create synergy that is one plus one is more than t w o .
Banking sector plays a crucial role in the economic g r o w t h and development of a nation.
Globalisation, deregulation of economies coupled w i t h technological development has changed the banking landscape dramatically. W i t h the fast changing environment, the banking sector is resorting to the process of consolidation, corporate restructuring and strengthening to remain efficient and viable. For this, Mergers and Acquisitions have become the preferred strategy for g r o w t h in the size of banks which in t u r n play a significant role in entering the global financial market. Besides Mergers and Acquisitions are widely used for achieving higher market share, overall productivity and profitability, expanding branch networks, strengthen their capital base, cost rationalisation, economies of scale and manpower efficiency.
Mergers and Acquisitions in Indian banking sector have been initiated in response to the various economic reforms introduced by t h e government of India since 1991, in its move towards liberalisation,

privatisation

and

globalisation.

On

the

recommendation

of

Narshimam Committe I (1991), Narshimam committee II (1997) and Verma

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