Banking Crises and Market Timing: Evidence from M&As in the Banking Sector

Chung-Hua Shen, Yehning Chen, Hsing-Hua Hsu and Chih-Yung Lin
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Chung-Hua Shen: Nanjing Audit University
Yehning Chen: National Taiwan University
Hsing-Hua Hsu: National Taiwan University

Journal of Financial Services Research, 2020, vol. 57, issue 3, No 4, 315-347

Abstract: Abstract We investigate whether the gains are greater for banks that conduct mergers and acquisitions (M&As) during banking crises than during non-crisis periods. We contribute to the literature by examining 1984 M&As using global banking sample from 106 countries (areas) during 1994 ~ 2009. We find the synergistic gains of acquiring banks during banking crises are larger than those during non-crisis periods. We further find that such gains are greater when acquiring weak targets, for acquirers in developed countries, and for acquirers in domestic M&As. This study confirms that a banking crisis is an appropriate time for banks to conduct M&As.

Keywords: Banking crises; Mergers and acquisitions; Synergistic gains (search for similar items in EconPapers)
JEL-codes: G01 G15 G21 G34 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s10693-019-00318-4

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