Open Access Research Article
NAVIGATING CHANGE: AN ANALYSIS OF RECENT MERGERS & ACQUISITIONS IN THE INDIAN BANKING SECTOR
Published Paper
Article Details
AUTHORED BY - SIDDHARTH SIVASELVAM
Abstract
A robust economy relies heavily on the presence of a well-functioning and
secure banking system. The banking system in India has notable variations in
comparison to other Asian countries, mostly attributable to the unique
geographic, social, and economic characteristics of the nation. The banking
sector plays a substantial role in bolstering the Indian economy through the
provision of timely loans to diverse societal segments, alongside the
collection of deposits from these segments. Commercial banks play a crucial
role in fostering equitable regional development in India through the provision
of essential financial infrastructure and funding to undeveloped regions.
Additionally, they promote the preservation of individuals' financial resources
and their allocation towards investments in lucrative ventures, thereby
stimulating economic expansion and subsequently leading to a substantial
enhancement of employment opportunities. A multitude of domestic and
international banks engage in merger and acquisition endeavours. The article
initially provides a concise examination of conducting a comparison study of
the rules outlined in the Companies Act, 2013 and subsequently endeavours to
extract the distinctions with the requirements under the Banking Regulation Act,
1949. Moreover, the present study endeavours to draw a conclusion by
determining the distinct variations and commonalities within the two
legislations. This study aims to analyse the operational dynamics of
significant mergers and acquisitions within the Indian banking sector in recent
years. An essential prerequisite entails the integration of the Indian banking
system via mergers and acquisitions, guided by corporate considerations and
goals. Bank mergers incentivize financial organisations to engage in global
expansion and foster enhanced synergy, hence facilitating the acquisition of
distressed assets by larger banks from their smaller counterparts. This article
aims to clarify the necessity of bank mergers and acquisitions and examine
their effects on the equity shares of shareholders' capital and the financial
performance of the relevant banks.
Keywords: Indian Banking Sector, Mergers,
Acquisitions, Banking Regulation Act 1949, Companies Act 2013, Shareholders,
Equity Shares, Financial Performance.
Research Problem
The present study aims to examine the effects of mergers and acquisitions
(M&As) on the financial performance of a specific group of banks operating
within the Indian banking sector. The objective of this study is to evaluate
the impact of mergers and acquisitions (M&As) on important financial
metrics, such as Return on Assets (ROA), Return on Equity (ROE), and Net Profit
Ratio. The primary focus of this research pertains to comprehending the
efficacy of mergers and acquisitions (M&As) in augmenting the general
fiscal well-being of banks, as well as discerning the components that
contribute to favourable or unfavourable results following a merger.
Furthermore, the study investigates the impact of size, financial stability,
and financing approaches on the outcomes of mergers and acquisitions. This
study examines significant inquiries on financial patterns, capital
effectiveness, and marketing strategies following a merger, offering useful
perspectives on the dynamics of mergers and acquisitions within the banking
industry in India.
Research Questions
1) Evaluate the legal framework governing Mergers and Acquisitions in the
financial sector?
1) How does the post-merger marketing approach affect banks' total
financial performance, taking into account elements like Return on Assets, Return
on Equity & Net Proft Ratio?
Research Methodology
The current investigation has utilised secondary data sources. The
financial and accounting data utilised in this study were obtained from the
publicly available annual reports of the bank, publications of the Reserve Bank
of India, and various websites that offer data on the selected banks. These
sources were utilised to examine the impact of mergers and acquisitions on the
financial performance of the sample banks. This study selects six instances of
merger and acquisition in the Indian Banking Sector as a sample. These
instances include the merger of Indian Bank with Allahabad Bank, Union Bank of
India with Andhra Bank and Corporation Bank, Punjab National Bank with Oriental
Bank of Commerce and United Bank of India, Canara Bank with Syndicate Bank,
Bank of Baroda with Dena Bank and Vijaya Bank, and State Bank of India with
State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Patiala,
Bharatiya Mahila Bank, State Bank of Travancore, and State Bank of Hyderabad.
This study utilises key financial indicators to assess the pre- and post-merger
financial performance of the banks in question. These metrics include Return on
Assets, Return on Equity, and Net Profit Ratio. The financial ratios for the
pre-merger and post-merger periods were computed by taking the average values
throughout the two years preceding the merger and the year subsequent to the
completion of the merger.
Literature Review
The article "Recent Mergers and Acquisitions in the
Indian Banking Sector- A Study" by Dr Ravi. B, Associate Professor of
Commerce, VSK University, discusses the importance of consolidation in the
Indian banking sector for economies of scale, regional diversity, lower costs,
cross-border expansion, and market share concentration. The study highlights
the central government's role in policy formulation and the challenges faced by
the sector in the future. The author emphasizes the need for banks to enhance
operational effectiveness, risk management, and customer service to remain
competitive. The article also discusses the regulatory structure controlling
mergers and acquisitions in the Indian banking sector, including the
Competition Act, 2002.
The article "Mergers and Acquisitions in Indian
Banking Sector" by Prannath Singh Yadaw, Ayushi Agarwal, Vijay Kumar Ojha,
and Ajai Kumar Singhal discusses the benefits and challenges of mergers and
acquisitions (M&A) in the Indian banking sector. The article highlights the
competitive climate, the need for qualified staff, sound governance, and
regulation, and the two significant eras in India's financial history:
nationalisation of banks in 1969 and the 1990s when private sector banks
entered the market. The benefits of M&A include greater market share, scale
economies, and enhanced operational efficiency. However, the article also
discusses the challenges faced by banks during the M&A process, such as
regulatory obstacles and integration problems. The article concludes that
M&A is a valuable tool for corporate restructuring and growth in the Indian
banking industry, but also emphasizes the importance of meticulous preparation
and execution throughout the process.
The paper "The Impact of Mergers and Acquisitions
on the Financial Performance of the Indian Banking Sector: An Analytical
Study" by Jaspreet Kaur and Dr. Ravinderjit Singh examines the impact of
mergers and acquisitions on the Indian banking industry. The authors argue that
a robust economy relies on an effective banking system, and India's unique
geography and socioeconomic factors make it unique. They suggest that M&As
can lead to scale economies, increased effectiveness, and competitiveness, but
can also have negative outcomes like rising costs, cultural conflicts, and low
staff morale.
Behara Yerram Raju, a Finance and Accounting Professor
at Hyderabad's Institute of Public Enterprise, discusses the debate on mergers
and acquisitions in the Indian banking industry, particularly the State Bank of
India (SBI) merger in 2017. He argues that while mergers can increase
efficiency and competitiveness, they must be properly planned and implemented
to avoid negative effects on shareholders, customers, and staff. Raju examines
the advantages and hazards of mergers, their effects on profitability,
liquidity, and market share, and the difficulties in carrying out these
transactions, such as legislative changes, efficient human resource management,
and a clear strategy for the sector's future. The SBI merger and the PCA Plan for
PSBs also face challenges, such as integration, cultural, and human resource
management issues. Raju provides a comprehensive analysis of the challenges and
opportunities faced by the Indian banking industry in the context of mergers
and acquisitions, offering insights for policymakers, regulators, and industry
stakeholders.
Overview of Mergers and Acquisitions (M&As) in the Indian Banking
Sector
The Indian banking industry has
undergone significant development since the 18th century, marked by the
establishment of the General Bank of India in 1786 and the Bank of Hindustan in
1790. These institutions were formed with considerable dedication and effort
during their respective years of inception. In the ensuing years, the Bank of
India underwent significant changes under the influence of the British East
India Company, ultimately resulting in its renaming as the State Bank of India.
During the period from 1906 to 1911, numerous further banks were established,
namely Bank of Baroda, Corporation Bank, Bank of India, Central Bank of India,
Indian Bank, and Canara Bank.
These banks continue to maintain their position in the Indian banking
business to this day. The banking industry in India has been undergoing
significant changes in terms of procedures, strategies, and systems. Mergers
and acquisitions (M&As) have the potential to facilitate the development of
new capacities and competencies, as well as enhance skills and knowledge, hence
promoting continuous learning (Kumari, 2014).[1] The Indian economy underwent a substantial transition and experienced
structural changes in 1991 due to the implementation of several economic
reforms by regulatory authorities. Mergers and acquisitions (M&As) have
acquired substantial importance within the Indian sector subsequent to the year
1991. Competence and size are considered to be the primary factors that enable
business entities to understand the imperative for Indian enterprises to expand
and thrive in the context of global competition.
The Indian corporate sector has implemented corporate restructuring as a
strategic business approach to establish a more formidable position in the
global domain (Gupta, 2015). The banking sector has been categorised into two
distinct eras, namely the pre-liberalisation era and the post-liberalisation
era, since 1991.[2] In the pre-liberalisation era of 1969, the Indian government undertook
the nationalisation of the 14 major banks. Between the years leading up to
1980, an additional six banks underwent the process of nationalisation. This
measure was undertaken with the ultimate objective of enabling the government
to exercise control over credit distribution. In 1993, the government facilitated
a merger between Punjab National Bank and New Bank of India, resulting in a
reduction of the number of nationalised banks in India from 20 to 19. During
the period of post-liberalisation, a significant transformation occurred within
the Indian banking system, characterised by the issuance of licences to
multiple private banks. The private banks mentioned in this context encompass
Global Trust Bank, which underwent amalgamation with Axis Bank, as well as HDFC
Bank, ICICI Bank, and Oriental Bank of Commerce. The amalgamation subsequently
contributed to the expansion of the Indian banking industry, in addition to the
growth of the Indian economy. The entire growth has been achieved through the
contributions of private banks, government banks, and foreign banks, which are
the three key segments of the banking industry. Numerous alterations were
recognised in relation to the establishment of several additional institutions,
namely the Bank of Madras, the Bank of Bengal, and the Bank of Bombay. The consolidation
of the respective banks took place in 1921, resulting in the establishment of
'The Imperial Bank of India', subsequently renamed as 'State Bank of India'.
During the period from 1906 to 1911, numerous further banks were established,
namely Bank of Baroda, Corporation Bank, Bank of India, Central Bank of India,
Indian Bank, and Canara Bank. These banks continue to maintain their position
in the Indian banking business to this day. The banking industry in India has
been undergoing significant changes in its processes, strategies, and systems.
Mergers and acquisitions (M&As) have the potential to facilitate the
development of new capacities and competences, as well as enhance skills and
knowledge, hence promoting continuous learning (Kumari, 2014).[3]
The Indian economy underwent a substantial shift and experienced
structural changes in 1991 due to a series of economic reforms imposed by
regulatory authorities. Mergers and acquisitions (M&As) have acquired
considerable importance within the Indian sector subsequent to the year 1991.
Competence and magnitude are considered as the primary focal areas that enable
business entities to understand the imperative of Indian enterprises to expand
and thrive within the context of a globally competitive environment. The Indian
corporate sector has implemented corporate restructuring as a strategic
business approach to establish a more formidable presence in the international
domain (Gupta, 2015).[4] Since 1991, the banking sector has been characterised by two distinct eras:
the pre-liberalisation era and the post-liberalisation era. In the pre-liberalisation
era of 1969, the Indian government nationalised the 14 major banks. From the
years following until 1980, an additional six banks underwent nationalisation,
a process undertaken with the aim of government control over loan distribution.
In 1993, the government facilitated a merger between Punjab National Bank and
New Bank of India, resulting in a reduction of the number of nationalised banks
in India from 20 to 19. During the period of post liberalisation, a significant
transformation occurred in the Indian banking system, characterised by the
issuance of licences to numerous private banks. The private banks mentioned in
this context encompass Global Trust Bank, which underwent amalgamation with
Axis Bank, as well as HDFC Bank, ICICI Bank, and Oriental Bank of Commerce. The
merging subsequently contributed to the expansion of the Indian banking
industry, as well as the growth of the Indian economy. The entire growth has been
achieved through the contributions of private banks, government banks, and
foreign banks, which are the three key segments of the banking industry. The
Indian banking industry has seen several modifications in terms of structural
and regulatory changes due to the influence of globalisation. The Indian
banking sector has implemented many tactics to enhance efficiency and maintain
a competitive edge in the global arena, in response to the dynamic nature of
the environment. Mergers and acquisitions can be regarded as strategic
approaches to consolidation aimed at addressing competitiveness in the global
arena, as observed in the Indian banking industry[5]. The primary emphasis of the Indian banking sector lies in the
implementation of a comprehensive strategy for risk management. Banks are
endeavouring to adopt international banking supervision practises by adhering
to and implementing the guidelines outlined in the Basel II framework.
Furthermore, the majority of banks are successfully fulfilling the capital
requirements in accordance with the Basel-III standards. In the present context
of the Indian banking sector, it is observed that public banks constitute 27%
of the total, private banks constitute 21%, and foreign banks constitute 49%.
Furthermore, it is worth noting that the current count of regional banks is 56,
while the number of rural cooperative banks is 94384, and the number of urban
cooperative banks is 1562 (Biradar, 2020). Over the past few years, the Indian
banking sector has experienced a series of mergers and acquisitions, resulting
in significant transformations in the financial standing of the involved banks.
The compilation of mergers and acquisitions that transpired within the Indian
Banking sector over the specified timeframe.
Regulatory Framework that governs mergers and acquisitions (M&A) in
the banking sector, specifically focusing on the Banking Regulation Act of 1949
and the Companies Act of 2013.
The BR Act and firms Act share certain parallels in their laws pertaining
to mergers involving either firms or banking companies. The voluntary
consolidation of two banking entities is addressed under Section 44A of the
Banking Regulation Act[6]. Similarly, the voluntarily merging of businesses is governed by Section
232[7] of the Companies Act, 2013. In the event that a scheme is approved under
Section 230[8] of the Companies Act, 2013 in relation to a banking company, it is
pertinent to note that the provisions outlined in Section 340[9] of the Companies Act, 2013 and Section 45H[10] of the Banking Regulation Act (BR Act) will be applicable to the banking
company undergoing liquidation, as if the order approving the compromise or
arrangement were an order for the winding up of said banking company. Sections
340 and 45H exhibit similarities, as previously elucidated. The authority of
the High Court to instruct the Reserve Bank of India (RBI) to conduct an
investigation is akin to the court's ability to request reports from the
Registrar of Companies. Upon granting approval for the amalgamation, the Reserve
Bank of India (RBI) has the authority to issue a further written order,
stipulating a certain date on which the combined banking entity will be
required to cease its operations and be dissolved. The implementation of any
such directive shall be valid and enforceable, regardless of any conflicting
provisions in any other legislation. The aforementioned bears resemblance to
the powers vested in the Tribunal as stipulated in Section 232(3) (d) of the
Companies Act, 2013, enabling the dissolution of the transferor company without
undergoing the process of winding up. In order to dissolve the transferor
company, it is necessary for them to provide the Registrar of Companies, with
whom the banking company is registered, a copy of the order issued by the
Reserve Bank of India (RBI) directing the dissolution. Upon receiving this
order, the Registrar is then responsible for removing the name of the company
from the records. The aforementioned paragraph has resemblance to the provision
found in Section 232[11]. Upon approval of the merger scheme by the Reserve Bank of India (RBI),
the assets and liabilities of the bank are transferred to the acquiring bank.
The aforementioned provisions bear resemblance to those outlined in Section
232(4) of the Companies Act, 2013. The process of merger as governed by the
businesses Act and the amalgamation of banking businesses as regulated by the
Banking Regulation Act exhibit distinct variations across multiple dimensions.
In the context of corporate mergers, it is imperative to safeguard the
interests of investors, as well as to ensure the protection of depositors'
interests in the event of bank mergers. The High Court lacks the authority to
issue clearance for the merging of banking companies, but the Reserve Bank of
India (RBI) possesses the power to do so. In alternative terms, it might be
posited that the High Court grants approval to the scheme in accordance with
the provisions of the Companies Act, but the Reserve Bank of India (RBI)
possesses ultimate jurisdiction under the Banking Regulation Act with regards
to bank mergers. The Reserve Bank of India (RBI) has the authority to ascertain
the market value of shares held by dissenting shareholders who have either
opposed the scheme or have submitted written objections prior to the banking
company's meeting to the relevant Presiding Officer. The shareholders who have
been negatively affected by the merger of the banking businesses have the right
to receive a compensation equal to the assessed worth of their shares, as
determined by the Reserve Bank of India (RBI). In accordance with Section 230
of the Companies Act, 2013, when a banking company submits an application, the
High Court possesses the authority to instruct the Reserve Bank of India (RBI)
to conduct an investigation into the banking business's operations and the
behaviour of its directors. The numerical value provided by the user is 67.
Nevertheless, in accordance with the Companies Act, the Court possesses the
authority to request a report from the Registrar of Companies prior to issuing
an order of merger. This report is intended to ascertain if the company's
operations have been handled in a manner that is detrimental to the public's
interests. The Companies Act, as per its provisions, specifically refers to the
"High Court" rather than the "National Company Law
Tribunal." It is important to acknowledge that according to Section 408 of
the Companies Act, 2013, the Tribunal is granted powers and functions that are
given upon it by the Act or any other current legislation. Hence, it is
plausible that the Tribunal may likewise be endowed with the powers outlined in
the BR Act. The laws pertaining to the consolidation of private banks are
addressed in Section 45 of the Banking Regulation Act (BR Act). This bears
resemblance to the obligatory mergers of businesses as outlined in Section 237
of the businesses Act, 2013[12].
Data Analysis and Interpretation of Recent M&As in the Banking Sector
1) Return on Assets (ROA)
The Return on Assets ratio is derived by dividing a company's net income,
adjusted for taxes, by the total value of its assets. It is imperative to bear
in mind that due to the significant leverage employed by banks, a return on
assets (ROA) ranging from 1 to 2% might nevertheless indicate substantial
revenues and profits for a bank. The table below displays the return on assets
of the banks under investigation as per this report[13].
|
Name of the Bank
|
Year of Merger
|
Return on Equity (ROA) in %
|
|||
|
Pre-merger
|
Post-merger
|
||||
|
31/03/2019
|
31/03/2020
|
31/03/2021
|
31/03/2022
|
||
|
1) Indian Bank
|
1st April 2020
|
0.11
|
0.24
|
0.47
|
0.58
|
|
2) Union Bank of India
|
1st April 2020
|
-0.59
|
-0.52
|
0.27
|
0.44
|
|
3) Punjab National Bank
|
1st April 2020
|
-1.28
|
0.04
|
0.16
|
0.26
|
|
4) Canara Bank
|
1st April 2020
|
0.04
|
-0.30
|
0.22
|
0.46
|
|
|
|||||
|
|
|
31/03/2018
|
31/03/2019
|
31/03/2020
|
31/03/2021
|
|
5) Bank of Baroda
|
1st April 2019
|
-0.33
|
0.05
|
0.04
|
0.07
|
|
|
|||||
|
|
|
31/03/2016
|
31/03/2017
|
31/03/2018
|
31/03/2019
|
|
6) State Bank of India
|
1st April 2018
|
0.42
|
0.38
|
-0.18
|
0.02
|
The aforementioned table illustrates that the merger and acquisition of
Indian Bank, Union Bank of India, PNB, and Canara Bank resulted in a
substantial boost in their return on assets. Conversely, the Bank of Baroda
experienced minimal changes in their ROA. The table provides clear evidence
indicating that the return on assets (ROA) of SBI was higher in the period
preceding the merger compared to the period following the merger.
2) Return on Equity (ROE)
It is a comprehensive financial performance metric that integrates
information from both the balance sheet and income statement. The metric is
considered a gauge of an organization's profitability and efficacy in
generating financial gains. Profitability can be determined by dividing a
bank's net income by its shareholders' equity, with a higher quotient
indicating a more favourable return. The table below displays the return on
equity of the banks under investigation as indicated by this study.[14]
|
Name of the Bank
|
Year of Merger
|
Return on Equity (ROE) in %
|
|||
|
Pre-merger
|
Post-merger
|
||||
|
31/03/2019
|
31/03/2020
|
31/03/2021
|
31/03/2022
|
||
|
1) Indian Bank
|
1st April 2020
|
1.97
|
3.94
|
11.88
|
10.52
|
|
2) Union Bank of India
|
1st April 2020
|
-12.15
|
-9.46
|
4.87
|
7.94
|
|
3) Punjab National Bank
|
1st April 2020
|
-24.20
|
0.58
|
2.41
|
3.90
|
|
4) Canara Bank
|
1st April 2020
|
1.16
|
-6.78
|
5.05
|
9.85
|
|
|
|||||
|
|
|
31/03/2018
|
31/03/2019
|
31/03/2020
|
31/03/2021
|
|
5) Bank of Baroda
|
1st April 2019
|
-5.60
|
0.94
|
0.76
|
1.07
|
|
|
|||||
|
|
|
31/03/2016
|
31/03/2017
|
31/03/2018
|
31/03/2019
|
|
6) State Bank of India
|
1st April 2017
|
6.89
|
6.69
|
-3.37
|
0.39
|
Based on the provided table, it can be observed that the mergers and
acquisitions involving Indian Bank, Union Bank of India, PNB, Canara Bank, and
Bank of Baroda resulted in a notable increase in their respective return on
equity. However, the State Bank of India experienced a different trend. Prior
to the merger, the bank's return on equity stood at a higher value of 6.89.
Subsequently, following the merger, this metric transitioned from positive to
negative, only to revert back to a positive value in the subsequent fiscal
year.
3) Net-profit Ratio
The net profit ratio, alternatively referred to as the net profit margin
ratio, is a financial metric used to evaluate the profitability of a firm by
measuring the proportion of revenue generated in relation to its earnings. In
alternative terms, the net profit margin ratio elucidates the correlation
between a business's net profit after taxes and its net sales. The net profit
ratios of the banks under consideration are presented in the subsequent table
as per the findings of this study.[15]
|
Name of the Bank
|
Year of Merger
|
Net Profit Ratio in %
|
|||
|
Pre-merger
|
Post-merger
|
||||
|
31/03/2019
|
31/03/2020
|
31/03/2021
|
31/03/2022
|
||
|
1) Indian Bank
|
1st April 2020
|
1.67
|
3.51
|
7.68
|
10.15
|
|
2) Union Bank of India
|
1st April 2020
|
-8.65
|
-7.78
|
4.22
|
7.70
|
|
3) Punjab National Bank
|
1st April 2020
|
-19.44
|
0.62
|
2.50
|
4.61
|
|
4) Canara Bank
|
1st April 2020
|
0.74
|
-4.56
|
3.69
|
8.18
|
|
|
|||||
|
|
|
31/03/2018
|
31/03/2019
|
31/03/2020
|
31/03/2021
|
|
5) Bank of Baroda
|
1st April 2019
|
-5.57
|
0.87
|
0.71
|
1.17
|
|
|
|||||
|
|
|
31/03/2016
|
31/03/2017
|
31/03/2018
|
31/03/2019
|
|
6) State Bank of India
|
1st April 2017
|
6.06
|
5.97
|
-2.96
|
0.35
|
According to Table No. 3, it is evident that the net profit ratios of
Indian Bank, Union Bank of India, PNB, Canara Bank, and Bank of Baroda exhibit
a positive trend subsequent to the merger and acquisition. However, it is
noteworthy that the net profit ratio of SBI was initially higher (6.06) prior
to the merger but experienced a negative shift post-merger and acquisition.
Subsequently, in the subsequent financial year, the net profit ratio of SBI
returned to a positive value.
Suggestions & Conclusion
The aforementioned findings have led to the formulation of the following suggestions
for banks:
Ø It is advisable to enhance the
likelihood of a successful merger by concurrently conducting strategic and
financial analyses and planning. This planning should encompass the
implementation strategy of the merger, aligning it with the distinct
preferences of the two corporate entities involved.
Ø It is recommended that banks
prioritise equity financing over debt creation in order to enhance the capital
efficiency of the institution. Furthermore, the use of equity financing is
expected to enhance the bank's trustworthiness and foster trust among
stakeholders, hence stimulating additional investments for the institution.
Ø It is also advisable to suggest that
financially weaker banks experiencing a decline in the market consider pursuing
a merger and acquisition (M&A) strategy. This approach would potentially
yield synergistic benefits for the bank, such as enhancing its profitability
and augmenting shareholders' wealth in the near term through stock growth and
fostering trust with the bank.
Ø It is advisable for banks to adopt a
proactive marketing approach during the post-merger phase to promote their
financial products. This strategy can contribute to enhancing their financial
performance in terms of gross earnings, net assets, and post-tax profit.
Consequently, banks can effectively leverage the synergistic benefits arising
from mergers and acquisitions.
Mergers and acquisitions (M&A) are a prevalent business strategy
employed by organisations seeking to enhance value creation. Mergers facilitate
the enhancement of banks' financial underpinnings, acquisition of tax benefits,
and establishment of direct access to liquid assets. The determinants that can
impact the viability of a merger and acquisition's outcome encompass the
comparative magnitudes of the merging entities, the approach employed for
financing such transactions, and the quantity of offers made. The shareholder
value can be modified by autonomous structural forces. Based on the findings of
the present study, an analysis of financial indicators was conducted,
encompassing the pre- and post-merger and acquisition periods of selected
Indian banks. The results reveal a discernible positive transformation in the
financial performance of the banks under consideration, with the exception of
the State Bank of India (SBI) subsequent to the merger. The merger of the State
Bank of India (SBI) and its member banks necessitates the need to address the
issue of underperformance. However, the statement, which suggests that the
consolidation and merger of banks may result in temporary difficulties but will
provide long-term benefits in a relatively short period of time, acts as a
motivating factor for such actions.
List of References
1) Recent Mergers and Acquisition in Indian Banking sector- A Study Dr
Ravi.B, https://www.jetir.org/papers/JETIR1907O98.pdf
2) Mergers
And Acquisitions In Indian Banking
Sector Mr. Prannath Singh Yadaw, Ms. Ayushi
Agarwal, Dr. Vijay Kumar Ojha, Prof. Ajai Kumar Singhal https://www.researchgate.net/publication/369949577_Mergers_And_Acquisitions_In_Indian_Banking_Sector
3) The Impact of
Mergers and Acquisitions on the Financial Performance of Indian Banking Sector:
An Analytical Study, Jaspreet Kaur & Dr. Ravinderjit
Singh, https://thelawbrigade.com/wp-content/uploads/2023/04/Jaspreet-Dr.-Ravinderjit-AJMRR.pdf
4) Mergers & Acquisitions in Indian
Banking, Yerram Raju Behara, https://www.researchgate.net/publication/322020219_Mergers_Acquisitions_in_Indian_Banking
5) A Study on
Merger and Acquisition in Banking Industries S. Indrapriya https://www.ijlmh.com/wp-content/uploads/2019/03/A-Study-on-Merger-and-Acquisition-in-Banking-Industries.pdf
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Article Information
NAVIGATING CHANGE: AN ANALYSIS OF RECENT MERGERS & ACQUISITIONS IN THE INDIAN BANKING SECTOR
Authors: SIDDHARTH SIVASELVAM
- Journal IJLRA
- ISSN 2582-6433
- Published 2024/04/18
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
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