Impact of Bank Mergers on Share Price of The Banking Sector with Special Reference to Public Sector Banks in India

Abstract

Bank mergers and acquisitions have been a prominent feature of the financial landscape in recent years, driven by factors such as increased competition, technological advancements, and the pursuit of economies of scale. These consolidation activities can have significant implications for the performance and valuation of the merged entities, including their share prices. Understanding the impact of bank mergers on share prices is crucial for investors, regulators, and policymakers to assess the efficacy and potential consequences of such transactions. The study employs a panel data analysis approach to investigate the volatility and dynamics of share prices before and after the merger announcements and completions. The primary objective is to ascertain whether these bank mergers had a significant impact on the share price performance of the merged entities.