Performance Changes Around Banks Mergers and Acquisitions: Evidence from Poland

Budny Katarzyna (), Krasodomska Joanna () and Świetla Katarzyna ()
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Budny Katarzyna: Cracow University of Economics, Cracow, Poland
Krasodomska Joanna: Cracow University of Economics, Cracow, Poland
Świetla Katarzyna: Cracow University of Economics, Cracow, Poland

Financial Sciences. Nauki o Finansach, 2019, vol. 24, issue 2, 28-45

Abstract: This study investigates the influence of M&A on the performance of banks operating in Poland. We use a sample of 14 transactions that occurred in the Polish banking sector from 2001 to 2015. Our data set includes pre and post-merger accounting information covering a period of two years before and after the merger. We follow Pilloff’s [1996] approach to determine the average performance changes measured with ROAA and ROAE. According to the research results, M&As transactions seem to affect profitability as both ROAA and ROAE means change. However, these changes do not follow the same trend. The correlations between the acquirer’s pre-merger weighted performance measured with ROAA and ROAE and merger-related changes in performance are significant and negative. The same situation is observed as regards the target pre-merger weighted performance measured with ROAE and merger-related changes in performance. The results also suggest that large acquirers are associated with less successful M&A.

Keywords: banks; M&A; Poland; ROAA; ROAE (search for similar items in EconPapers)
JEL-codes: G21 G34 (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:finsci:v:24:y:2019:i:2:p:28-45:n:3

DOI: 10.15611/fins.2019.2.03

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