Are All Bank Acquisitions Equal? The Impact of Bank Mergers and Acquisitions around the 2007-2009 Financial Crisis: Evidence from TARP

Abstract

The large wave of bank mergers, which had affected the US bank sector in the years leading 2007-2009 crisis, experienced a sudden decline in both volume and value in the post-financial crisis period. This study examines whether TARP banks, i.e. banks that received government financial support during the recent 2007-2009 crisis, differed in terms of M&A financial performance outcomes in the pre and post financial crisis periods compared to non-TARP recipients. We find significant and differences in the post-merger financial performance of TARP recipients compared to non-TARP recipients in the post financial crisis period but no significant differences in their pre-merger performance. Our results infer differences in merger motivations for TARP and non-TARP banks.

DETERMINANT OF CUSTOMER LOYALTY FOR BANK SYARIAH INDONESIA AFTER M&A ACTIVITY BASED ON CONFIRMATORY FACTOR ANALYSIS

“…Financial risk control and avoidance measures are crucial considerations in M&A transactions, especially in the context of overseas mergers and acquisitions (H. Liu, 2022). Moreover, the impact of M&A on the performance of banks around financial crises, such as the 2007-2009 financial crisis, has been studied, revealing the complexities and interconnectedness of individual bank performance with broader industry trends (T. King & Kong, 2016).…”