international journal of research & development in technology and management...

International Journal of Research & Development in Technology and Management Science –Kailash

Volume - 22| Issue 1 | 2015 | ISBN - 1-63102-453-1 European Article Number [EAN] - 978-163-102-453-5

[email protected] | [email protected] | http://journal.rtmonline.in | http://www.ijrdtm.com

Paper Id: IJRDTM –053087

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MERGER & ACQUISITION IN THE INDIAN BANKING INDUSTRY:

ITs IMPACT ON OPERATING PERFORMANCE

by

Dr. Anjala Kalsie | Faculty of Management Studies | University of Delhi

| [email protected]

&

Jappanjyot Kaur Kalra | Research Scholar | Faculty of Management Studies

| University of Delhi

ABSTRACT

The objective of the paper is to understand the impact of Merger and

Acquisitionon performance in the Indian Banking Industry. To fulfill the

objective five M&A deals which took place in the last decade in the Indian

banking industry have been studied. Hypothesis testing has been

undertaken to understand whether there is significant difference in the

bank’s operating performance pre and post-merger. The results of the

study indicate that the banks have been positively affected by the event of

the M&As. This suggests that merged banks can obtain efficiency and

gains through Merger and Acquisitions and eventually pass the benefits to

the equity share holders.

KEYWORDS: Merger and Acquisition, Indian Banking, operating performance.

I. INTRODUCTION

The Indian banking sector can be divided into two eras; the pre liberalization era and the post

liberalization era. In pre liberalization era the government of India nationalized 14 Banks on 19

July 1969 and later on 6 more commercial Banks were nationalized on 15 April 1980. In the

year 1993 government merged The New Bank of India and The Punjab National Bank and this

was the only merger between nationalized Banks. Afterwards the numbers of nationalized

Banks reduced from 20 to 19. In post liberalization regime, government initiated the policy of

liberalization and licenses were issued to the private banks which led to the growth of Indian

Banking sector.

mailto:[email protected]





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Mergers and acquisitions have been initiated in the Indian banking sector through the

recommendations of Narasimham committee II. The committee recommended that “merger

between strong banks/financial institutions would make for greater economic and commercial

sense and would be case where the whole is greater than the sum of its parts and thus have a

“force multiplier effect”. Quite a few mergers and acquisitions have taken place in the Indian

banking industry across the two eras as can be seen in the table 1 given in the appendix.

In a survey conducted among Indian corporate managers across various industry verticals in

2006 by Grant Thornton, it was observed that M&As are a significant form of business strategy

today for the Indian corporate. The two main objectives behind any M&A transaction were

found to be namelyImproving revenues and profitability &Faster growth in scale and quicker

time to market.

II. LITERATURE REVIEW

The number of studies evaluates the effects of bank mergers comparing pre- and post- merger

performance by measuring performance using either accounting or productive efficiency

indicators. An important starting point for this group is that the latest empirical studies

measuring bank efficiency show that scale economies seem to exist in the banking sector in the

United States and Europe. This finding tentatively suggests that improvements in efficiency

could be expected from banking mergers (see Houston, James and Ryngaert 2001).

The majority of studies comparing pre- and post-merger performance finds that the potential

efficiency gains derived from size rarely materialise (see Piloff, 1996, and Berger, Demsetz

and Strahan, 1999). A possible rationale for this puzzle could be that some efficiency gains

might take a long time to accrue (see Focarelli and Panetta, 2003). More specifically, while

some efficiencies (such as those derived from risk diversification or the benefits of brand

name) can be accrued inthe short run, others such as the benefits derived from cost reductions

or the majority of scope economies might take longer to materialise. This is probably due to the

difficulties of integrating broadly dissimilar institutions (see Vander Vennet, 2002). All other

things being equal, a combination of firms with different culture and strategic characteristics is

expected to be followed by difficulties associated, among other things, with clashes between

corporate cultures that could hinder performance.

Various studies have provided an interesting contribution by sub-sampling the population of

merging banks, according to product or market relatedness, to analyse whether certain shared

characteristics among merging institutions could create or destroy shareholder value or

performance. By and large, the main conclusion of these studies is that while mergers among

banks showing substantial elements of geographical or product relatedness create value,

dissimilarities tend to destroy overall shareholder value (see Amihud, De Long and Saunders,

2002, and Houston and Ryngaert, 1994).





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The recent Indian studies are listed below:

Mantravadi Pramod & Reddy A Vidyadhar (2007) in their paper “Type of Merger and Impact

on Operating Performance: The Indian Experience” evaluated the impact of merger on the

operating performance of acquiring firms in different industries by using pre and post financial

ratios analysis. Result suggested that there was little variation in terms of impact as far as

operating performance after mergers was concerned. In India particularly banking and finance

industry had a slightly positive impact of profitability.

Anand Manoj & Singh Jagandeep (2008) in their paper “Impact of Merger Announcements on

Shareholders' Wealth: Evidence from Indian Private Sector Banks” studied the impact of

merger announcements of five banks in the Indian Banking Sector on the share holder bank.

The announcement of merger of Bank had a significant positive impact on share holder’s

wealth.

Goyal K.A. & Joshi Vijay (2011) in their paper “Merger and Acquisition in Banking Industry:

A Case Study of ICICI Bank Ltd.” discuss all the mergers, acquisitions and amalgamations of

ICICI Bank from various aspects. It also mentions the benefits that come out through M&As.

III. OBJECTIVE AND METHODOLOGY

The scope and objectives of this paper is to analyze 5 M&A deals that took place in the Indian

banking sector in the last decade. The 5 deals are:

Nedungadi Bank Ltd & Punjab National Bank; February 1, 2003

Bank of Punjab Ltd & Centurion Bank Ltd; October 1, 2005

United Western Bank Ltd & IDBI Bank Ltd; October 3, 2006

Centurion Bank of Punjab Ltd & HDFC Bank Ltd; May 23, 2008

The Bank of Rajasthan & ICICI Bank Ltd; August 13, 2010

These deals are analyzed from a qualitative as well as quantitative aspect. For the quantitative

part, the banks’ performances in terms of the major financial ratios are analyzed pre- and post-

merger using statistical tools. The null and alternate hypothesis are stated as follows:

H0 (Null Hypothesis) There is no significance difference between the pre and post merger on

Net Profit Margin.

H1 (Alternative Hypothesis) There is significance difference between the pre and post merger

on Net Profit Margin.


Return on Capital Employed.


on Return on Capital Employed.





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Return on Equity.


on Return on Equity.


Debt Equity Ratio.


on Debt Equity Ratio.

IV. METHODOLOGY

Data Collection: For the purpose of quantitative analysis data has been sourced from the

banks’ annual report and financial statements. Data has also been taken from the Bombay

Stock Exchange, the National Stock Exchange and money control.

Methodology: To test the hypothesis, the methodology of comparing the pre- and post-

merger performances of banks has been adopted by using certain financial ratios such as

Gross profit margin, Net profit margin, Operating profit margin, Return on capital

employed, Return on equity, and Debt equity ratio. The pre merger (3years prior) and post

merger (after 3 years) financial ratios are being compared. The observation of each case in

the sample is considered to be an independent variable. Before merger two different banks

carried out operating business activities in the market and after the merger the bidder bank

is carrying out the business of both the banks. Independent t- test has been used keeping in

view the purpose & objectives of the study. The year of merger has been considered as a

base year and hence denoted as 0 and excluded from the evaluation. For the pre (3 years

before) merger the combined ratios of both banks are considered and for the post merger

(after 3 years) the ratios of acquiring bank were used. The Student’s t- distribution is

t = ( 1 - 2) √N / S

1 = ∑x1/n1

2 = ∑x2/n2

N = n1 + n2

S = √ [∑ (xi - )2 * (1/ (N-2)]

( 1 is the mean of combined pre merger ratios of both banks and 2 is the mean of

acquiring bank post merger. n1 and n2 are the number of observations of 1st and 2nd series

respectively. S is the combined standard deviation)

Financial Ratios

Gross Profit Margin = Gross Profit/Revenue * 100

Net Profit Margin = Net Profit/Revenue * 100

Operating Profit Margin = Operating Profit/Revenue * 100

Return on Capital Employed = EBIT/(Total Assets – Current Liabilities)





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Return on Equity = Net Profit/ Shareholder’s Equity

Debt-Equity Ratio = Total Liability/Shareholder’s Equity

V. ANALYSIS AND INTERPRETATION

In this section we look at the quantitative and qualitative analysis of each of the 5 deals.

Bank of Rajasthan & ICICI Bank:

The Bank of Rajasthan Ltd. was incorporated on May 7, 1943. It had a network of 463

branches and 111 ATMs as of March 31, 2009. It had a strong presence in Rajasthan with

branch network of 294 that is 63 percent of the total branches of BoR with men power strength

of more than 4300. The bank had total assets of Rs. 173 billion but its net profit was Rs. -1.02

billion as on March 2010 which shows that the bank was not in good financial condition. The

ICICI Bank Ltd. was incorporated on January 5, 1994. It had a network of 2,000 branches and

extension counters and over 5,300 ATMs as of May 21, 2010. The bank had total assets of Rs.

3634 billion and a net profit of Rs. 42.25 billion as on March 2010.

The objective of this merger from ICICI Bank’s perspective was its customer centric strategy.

This strategy of ICICI considers branches as the focal points of relationship management, sales

and service in geographical micro markets. It was a known fact that the BoR had deep

penetration with huge brand value in the State of Rajasthan where it had 294 branches with a

market share of 9.3% in total deposits of scheduled commercial banks. ICICI wanted this

merger to place it among the top three banks in Rajasthan in terms of total deposits and thus

considerably augment its presence and customer base in Rajasthan. The merger was valued at

Rs 3041 crores and was carried out on a swap ratio of 25:118. (A BoR shareholder will receive

25 ICICI shares for every 118 BoR shares held.) The deal priced the market capitalization per

branch for about Rs 6.5 crores, which is similar to other old private sector banks. Moving on to

the quantitative analysis part, the financial ratios of the combined and individual profiles of

both the banks pre-merger and the acquirer bank post merger have been calculated.

Table 1

ICICI

Ratios Mar '06 Mar '05 Mar '04 Mar '02 Mar '01

Mar

'00

Gross Profit Margin 45.87 44.43 48.02 42.04 40.80 45.39

Net Profit Margin 17.19 15.75 15.79 9.58 10.48 10.38

Operating Profit Margin 26.25 25.20 26.25 12.78 11.97 14.03

Return on Capital Employed (%) 0.13 0.11 0.12 0.05 0.05 0.07

Return on Equity (%) 7.22 5.61 4.47 3.38 3.74 3.46

Debt-Equity Ratio 465.31 424.26 352.69 340.70 359.31 383.23





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Table 2

Bank of Rajasthan

Ratios Mar '02 Mar '01 Mar '00

Gross Profit Margin 34.09570957 38.1146679 50.833613

Net Profit Margin 7.769636964 9.69166702 12.372161

Operating Profit Margin 6.881188119 11.663652 13.045765

Return on Capital Employed (%) 0.051204346 0.07449558 0.095374

Return on Equity (%) 0.729532073 0.85676037 1.0278888

Debt-Equity Ratio 106.7517818 117.523055 112.45673

Table 3

Combined (BoR & ICICI)






Return on Equity (%) 3.040733 3.426183 3.198687


The mean and standard deviation of these 2 sets of data have been calculated and the

corresponding t-value has also been computed.

Table 4

Mean and Standard Deviation of Pre-merger and Post-merger Ratios of combined

Banks (Bank of Rajasthan & ICICI) and Acquiring Bank (ICICI)

Ratios Mean Standard Deviation

t-value Pre Post Pre Post

Gross Profit Margin 42.67185453 46.1076221 2.5460509 1.80557021 -2.7350

Net Profit Margin 10.13847594 16.2454834 0.5382692 0.82152097 -15.557

Operating Profit Margin 12.84290103 25.900363 1.0495462 0.60492074 -13.669

Return on Capital Employed

(%) 0.058077849 0.11993962 0.008065 0.00893056 -12.608

Return on Equity (%) 3.22186775 5.76584524 0.1937677 1.37891013 -5.6035

Debt-Equity Ratio 332.8783955 414.083005 21.611627 56.993304 -3.5786

Calculated at 5% level of significance, critical t value = 2.132

From the above table we can see that the performance of ICICI after it acquired BoR has been

improved in terms of Net Profit Margin,Return on Capital Employed, Return on Equity and

Debt Equity Ratio as it is evident from the t value. All the Alternative Hypotheses have been

accepted and hence we can safely conclude that the merger of banks has been beneficial to the

Equity share holders and increases the overall bank performance in terms of profitability.





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Centurion Bank of Punjab & HDFC:

Centurion Bank of Punjab is India’s fourth largest private sector bank. It has a strong

nationwide franchise of 394 branches and 452 ATMs and is supported by an employee base of

over 7,500 employees. It had total assets of Rs 184 billion and a net profit of Rs 121 crores as

of March 2007.

Promoted in 1995 by housing development finance corporation, HDFC Bank is one of India’s

premier banks. It has over 11 million customers across over three hundred cities. As on

December 31, 2007, the bank had a network of 754 branches and 1,906 ATMs in 327 cities.

For the quarter ended December 31, 2007, the bank reported a net profit of Rs. 4.3 billion, up

45.2%, over the corresponding quarter of previous year.

HDFC looked at this merger to provide a greater presence in states like Punjab, Haryana and

Kerala and also give some headroom for greater capital market lending. Besides, it will help

HDFC bank to step up its retail and SME assets. Also the addition of 394 branches of CBoP

(32% of which are in the metros) will help the bank overtake ICICI Bank in terms of branch

presence. HDFC Bank has always maintained that fast branch expansion is a key ingredient

that will sustain its high CASA deposits and margins. Thus it gives HDFC a bigger metro

presence (44% increase) which is now hard to come by because of stringent RBI guidelines.

The acquisition makes HDFC Bank the seventh largest bank in terms of assets to take it past

other banks such as IDBI, Union Bank and Axis Bank. The total assets would rise to

Rs.1,10,110 crores, with branch network of 1150 and ATM network of 2100.

The deal worth Rs 3.6 billion was considered the biggest merger in Indian banking sector at

that time. It was carried out in the ratio of 1:29(1 share of HDFC Bank for 29 shares of CBoP).

Moving on to the quantitative analysis part, the financial ratios of the combined and individual

profiles of both the banks pre-merger and the acquirer bank post merger have been calculated.

Table 5

Centurion Bank of Punjab





Return on Capital Employed

(%) 0.077082179 0.04308188 0.0224278

Return on Equity (%) 0.774650584 0.86970106 0.297572






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Table 6

HDFC

Ratios Mar

'06

Mar

'05

Mar

'04

Mar

'02

Mar

'01

Mar

'00





Return on Equity (%) 8.44 6.44 5.28 4.33 3.56 2.75


Table 7

Combined






Return on Equity (%) 3.158965 2.727978 2.149246




Table 8


Banks (Centurion Bank of Punjab & HDFC) and Acquiring Bank (HDFC)






Return on Capital Employed (%) 0.0877 0.0533 0.0121 0.0690 -1.4682

Return on Equity (%) 2.6787 6.7196 0.5066 1.5993 6.6469

Debt-Equity Ratio 184.5416 504.3319 47.1316 84.1729 8.4367


From the above table we can see that the performance of HDFC after it acquired CBoP has

improved in terms of Net Profit Margin and Return on Capital Employed as it is evident from

the t value. Debt Equity Ratioand Return on Equity has not improved after the merger.





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United Western Bank & IDBI:

United Western Bank (UWB) was founded in 1936. It had 230 branches and 75 ATMs spread

over 47 districts in 9 states. It had total assets of Rs 70 billion and a net loss of Rs 98 crores as

on March 2005. The bank was put under moratorium by the RBI on September 2, 2006 due to

its ailing condition.

Industrial Development Bank of India was established in 1964 by an Act of Parliament to

provide credit and other facilities for the development of the fledgling Indian industry. IDBI

had total assets of Rs 829 billion and a net profit of Rs 415 crores as on March 2005. The bank

had a network of 195 branches and was looking forward to expand its presence.

On September 12, 2006 RBI had announced its decision to allow IDBI to acquire the bank.

RBI, for the first time, fixed a price of Rs 28 a share, which was to be paid by IDBI to UWB

shareholders. IDBI had to make upfront cash payment of Rs 28 per share and the shares of

UWB were extinguished. Against an outgo of Rs 150 cr, IDBI got access to 230 branches and

75 ATMs of UWB, mainly located in Maharashtra, which is one of the richest loan markets.

IDBI looked forward to use the branches of UWB to meet their priority sector targets, since

UWB had a good rural presence. The merger will also help IDBI diversify its credit profile and

improve its deposit mix. It will also expand IDBI's asset base by Rs 7,166 crores



Table 9

IDBI Bank

Ratios Mar '09 Mar '08 Mar '07 Mar '05 Mar '04 Mar '03





Return on Equity (%) 1.18 1.01 0.87 0.58 0.87 0.73


Table 10

United Western Bank



Net Profit Margin -17.8569489 5.19541542 3.6180614

Operating Profit Margin -15.9814624 10.1844238 16.409918

Return on Capital Employed (%) -0.14890279 0.09349581 0.1929805

Return on Equity (%) -3.30010037 1.03579793 0.7527601






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Table 11

Combined






Return on Equity (%) 0.421568 0.881562 0.726638




Table 12


Banks (United Western Bank & IDBI) and Acquiring Bank (IDBI)






Return on Capital Employed (%) 0.0203 0.0336 0.0098 0.0215 -1.4793

Return on Equity (%) 0.6766 1.0204 0.2340 0.1577 -3.0406




improved in terms of Net Profit Margin, Return on Capital Employed, Return on Equity and

Debt Equity Ratio as it is evident from the t value. From this we can infer that the merger of

banks has been beneficial to the bank’s operational performance as well as the balance sheet as

IDBI has been able to capitalize on UWB’s network and resources.

Bank of Punjab & Centurion Bank:

The Bank of Punjab was founded in 1995. It had total assets of Rs 48 billion and a net loss of

Rs 61 crores as on March 2004. Centurion Bank was incorporated on 30 June 1994. The bank

had total assets of Rs 35 billion and a net loss of Rs 67 crores as on March 2004. While Bank

of Punjab had 1,900 persons on its rolls, the number of employees of Centurion Bank now

stands at 1,300.

The deal was undertaken in a share swap ratio of 9:4. This means, for every four shares of Rs

10 of Bank of Punjab, its shareholders will receive nine shares of Re 1 of Centurion Bank.

After the merger, the paid up capital of the merged entity was about Rs 128 crores and the net





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worth was around Rs 692 crores. After the merger, the bank had total assets of Rs 9,395 crores

and deposits of Rs 7,837 crores. The merger also changed the holding pattern in the bank. Bank

Muscat, which held 31% in CB, now held 25% in the merged bank. The holdings of Capital

Corporation and Sabre Capital, which were 14% and 5.4% respectively in CB, came down to

11% and 4.4% respectively in the new bank. The new bank had a presence of 240 branches and

extension counters, 386 ATMs and about 2.2 million customers within the retail, SME and

agricultural segment. The capital adequacy ratio of the combined entity was 16.1 per cent. It

was thus an extremely well capitalized bank. The merger was a great fit in terms of achieving

scale and geographical presence. Moving on to the quantitative analysis part, the financial

ratios of the combined and individual profiles of both the banks pre-merger and the acquirer

bank post merger have been calculated.

Table 13

Centurion Bank



Net Profit Margin -16.909 -7.59275 -17.0018

Operating Profit Margin -80.8705 -42.6821 -15.244

Return on Capital Employed (%) -0.67394 -0.39282 -0.1623

Return on Equity (%) -1.1822 -0.2247 -0.61658


Table 14

Bank of Punjab






Return on Equity (%) 0.352380952 0.3032381 0.3401905


Table 15

Combined



Net Profit Margin -3.46208 -0.25749 -5.64049

Operating Profit Margin -34.1871 -19.0192 -3.09748

Return on Capital Employed (%) -0.26607 -0.17103 -0.03231

Return on Equity (%) -0.18603 -0.0094 -0.2264






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Table 16

Centurion Bank of Punjab

Ratios Mar '06 Mar '07

Gross Profit Margin 59.10636032 63.71425752

Net Profit Margin 7.101609534 10.98899127

Operating Profit Margin 12.12328647 7.262890621

Return on Capital Employed (%) -0.033565586 -0.10740934

Return on Equity (%) 0.774650584 0.869701058

Debt-Equity Ratio 117.9576233 80.45295747



Table 17


Banks (Bank of Punjab & Centurion Bank) and Merged Bank (Centurion Bank of Punjab)




Net Profit Margin -3.1200 9.0453 2.7078 2.7488 -7.7232

Operating Profit Margin -18.7679 9.6931 15.5463 3.4368 -5.1937

Return on Capital Employed (%) -0.1565 -0.0705 0.1176 0.0522 -1.7544

Return on Equity (%) -0.1406 0.8222 0.1154 0.0672 -18.2630




improved in terms of Net Profit Margin, Return on Capital Employed, Return on Equity and

Debt Equity Ratio as it is evident from the t value. All the Alternative Hypotheses have been

accepted and hence we can safely conclude that the merger of banks has been beneficial to the

Equity share holders and increases the overall bank performance in terms of profitability.

Nedungadi Bank &Punjab National Bank:

Nedungadi Bank was set up in 1899 in Kerala. It was the first private sector commercial bank

to be set up in South India. Over time, the bank established some 174 branches, including

branches in all major metropolitan cities. In 2002 the Joint Parliamentary Committee probing a

stock scam pointed out discrepancies in the conduct of its business. It had total assets of Rs 15

billion as on March 2002 and a net profit of Rs 1.27 crores after having suffered a net loss of

678 million in the year ended March 31, 2001.





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Founded in 1895, Punjab National Bank has over 5,800 branches and 6,000 ATMs across 764

cities and serves over 80 million customers. It had total assets of Rs 729 billion and a net profit

of Rs 562 crores as on March 2002.

Capital Inadequacy and a high level of Non-Performing Assets (NPA) were the main reasons

that led Nedungadi Bank into a severe financial crisis forcing the centre to put the bank under

moratorium. RBI merged the sick bank with the healthy bank to protect depositor's interests. At

the time of the merger with PNB, Nedungadi Bank's shares had zero value, with the result that

its shareholders received no payment for their shares. As a result of this merger PNB ended up

with a total of around 4,000 branches across the country with the addition of 174 branches of

NBL. But the important aspect here is that PNB didn’t have much presence in South India

which it wanted to overcome and through NBL it was able to establish a significant presence in

Kerala where it had only 20 branches earlier. The deal was a pure bail out for Nedungadi Bank.

There was a lot of skepticism around whether the deal was a win for PNB giving the financial

troubles of NBL.



Table 18

Punjab National Bank

Ratios Mar '06 Mar '05 Mar '04 Mar '02 Mar '01 Mar '00





Return on Equity (%) 4.56 4.47 4.18 2.65 2.16 1.92


Table 19

Nedungadi Bank



Net Profit Margin 16.90478303 -32.8838879 7.3948645

Operating Profit

Margin 11.14118378 -4.01590843 9.962596

Return on Capital

Employed (%) 0.189081325 -0.05871924 0.1524126

Return on Equity (%) 0.124509804 -6.64705882 1.4343137






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Table 20

Combined






Return on Equity (%) 2.533987 1.755215 1.900602




Table 21


Banks (Nedungadi Bank & PNB) and Acquiring Bank (PNB)






Return on Capital Employed (%) 0.1190 0.0734 0.0253 0.0449 2.2502

Return on Equity (%) 2.0633 4.4054 0.4141 0.2015 -3.2952




improved in terms of Net Profit Margin, Return on Equity and Debt Equity Ratio as it is

evident from the t value.Return on Capital Employed has not shown any improvement after the

merger.

VI. CONCLUSION

In this paper we have dealt with mergers and acquisitions specific to the Indian banking sector

and analyzed five deals that happened in the last decade. Using data collected from annual

reports and financial statements we were able to analyze the banks’ performance post merger

using statistical tools and were able to formulate inferences on whether the merger was

beneficial or not.Overall it was observed that the merger in the banking sector of India has

improved the key financial ratios. The results of the study indicate that the banks have been

positively affected by the event of the M&As. This suggests that merged banks can obtain





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efficiency and gains through Merger and Acquisitions and eventually pass the benefits to the

equity share holders.

VII. BIBLIOGRAPHY

1. Amihud, Y., G. De Long and A. Saunders (2002), “The effects of cross-border bank

mergers on bank risk and value”, Journal of International Money and Finance 21, 6, pp.

857-877.

2. Anand Manoj & Singh Jagandeep (2008), “Impact of Merger Announcements on

Shareholder’s Wealth Evidence from Indian Private Sector Banks”, Vikalpa, Volume 33,

No 1 January

3. Berger, A. N., R. S. Demsetz and P.E. Strahan (1999), “The consolidation of the financial

services industry: causes, consequences and implications for the future”, Journal of

Banking and Finance 23 (2-4), pp. 135-94.

4. Focarelli D. and F. Panetta (2003), “Are mergers beneficial to consumers? Evidence from

the market for bank deposits”, The American Economic Review 93, 4, pp. 1152- 1172.

5. Goyal Dr. K.A. & Joshi Vijay (2011), “Mergers in Banking Industry of India: Some

Emerging Issues”, Asian Journal of Business and Management Sciences, Issn: 2047-2528,

Vol. 1 No. 2, [157-165]

6. Houston, J. H. and M. Ryngaert (1994), “The overall gains from large bank mergers”,

Journal of Banking and Finance 18, 6, pp. 1155-1176.

7. Houston, J. H., C. James and M. Ryngaert (2001), “Where do merger gains come from?

bank mergers from the perspective of insiders and outsiders”, Journal of Financial

Economics 60, pp. 285-331.

8. http://www.hdfcbank.com/

9. http://www.idbi.com/

10. http://www.icicibank.com/

11. https://www.pnbindia.in/En/ui/Home.aspx

12. Mantravadi Pramod & Reddy A Vidyadhar. (2007), “Relative Size In Mergers And

Operating Performance: Indian Experience”, Economic and Political Weekly, September

29

13. News Article, “Bank of Rajasthan to merge with ICICI”, retrieved from

http://economictimes.indiatimes.com/

14. News Article, “Centurion Bank of Punjab, HDFC Bank to merge”, retrieved from

http://timesofindia.indiatimes.com/





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15. News Release, “HDFC Bank and Centurion Bank of Punjab merger at share swap ratio of

1:29”, retrieved fromhttp://www.hdfcbank.com/htdocs/common/pdf/CBOP_merger.pdf

16. News Article, “Punjab National Bank to take over Nedungadi Bank”, retrieved from


17. News Article, “RBI approves merger of Centurion Bank, Bank of Punjab”, retrieved from

http://www.moneyontrol.com/

18. News Article, “UWB, IDBI merger cleared”, retrieved from


19. Piloff, S. J. (1996), “Performance changes and shareholder wealth creation associated with

mergers of publicly traded institutions”, Journal of Money banking and Finance, 28, pp.

294-310.

20. Vander Vennet, R. (2002), “Cross-border mergers in European Banking and bank

efficiency”, University of Gent Working Paper 152.

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