Does bancassurance add value for banks? - Evidence from mergers and acquisitions between European banks and insurance companies

Zhian Chen and Jianzhong Tan

Research in International Business and Finance, 2011, vol. 25, issue 1, 104-112

Abstract: This paper investigates the risk and wealth effects of 72 mergers and acquisitions between banks in Europe and insurance companies during the period 1989-2004. The empirical results indicate that acquirers' total risks remain constant relative to the world, home market indices and home banking indices. There are no changes for the systematic risks (beta) with respect to the world market index or the home banking index. After removing world and home market indices effect, systematic risk against home banking index reduce significantly for domestic deals. In addition, positive wealth effects are documented. Two factors have contributed to the bidders' cumulative abnormal returns (CARs): relative deal size and being a serial acquirer. Finally, change of beta shows negative relations with CARs.

Keywords: Mergers; and; acquisitions; Insurance; Risk; change; Abnormal; returns (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0275-5319(10)00037-1
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:riibaf:v:25:y:2011:i:1:p:104-112

Access Statistics for this article

Research in International Business and Finance is currently edited by T. Lagoarde Segot

More articles in Research in International Business and Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().