The effect of board size on shareholder value: Evidence from bank mergers and acquisitions

Ioannis Tampakoudis, Michail Nerantzidis, Panagiotis Artikis and Nikolaos Kiosses

European Management Journal, 2022, vol. 40, issue 6, 883-894

Abstract: This study examines the effect of board size on the economic impact of bank mergers and acquisitions (M&A) in the US. Using a hand-collected dataset of 508 M&A between 2012 and 2018, we find that board size is negatively related to acquirer excess returns. In an additional analysis, we show that large boards have positive value implications for banks that combine the CEO and chairman roles as well as for large banks. Our findings indicate that a “one-size-fits-all” approach to board size is not necessarily in the interests of shareholders; instead, a more flexible and proactive formulation is needed.

Keywords: Board of directors; M&A; Banks; Agency theory; Resource-dependence theory (search for similar items in EconPapers)
JEL-codes: G14 G21 G34 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eurman:v:40:y:2022:i:6:p:883-894

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DOI: 10.1016/j.emj.2022.09.002

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