Impact of Mergers and Acquisition
Imapact of merger and aquisitions
1. INTRODUCTION
1.1 Background of the Study
The Pakistani banking sector has undergone extraordinary transformation over the years, in provisions of number of organizations, ownership constitution, as well as the deepness of operations. These modifications have been prejudiced mostly by challenges pretended by deregulation in policies of financial sector, globalization of procedures, technical innovations and embracing of managerial and prudential necessities that kowtow to international principles.
The wave of merger and acquisitions that currently swept through the banking sector started after the announcement by the state bank of Pakistan, that banks in Pakistan should beef up their minimum capital adequacy ratio should according to bank risk weighted assets or set by SBP.
Mergers and Acquisitions are commonplace in developing countries of the world but are just becoming prominent in Pakistan. Merger and acquisition is simply another way of saying survival of the fittest that is to say a bigger, more efficient, better-capitalized, more skilled industry. Is part of the natural evolution of industries? It is primary driven by Business motives or market forces and Regulatory interventions. The issues therefore , which this study intend to address are whether merger and acquisition will bring about efficient reliable and sound capital base for the bank that fully embraced mergers and to what extend can bank merge boost the confidence of the customers , the investors , the shareholders and ability to finance the real time sector .
1.2 Problem statement
The recent sudden increase of bank mergers in Pakistan is attracting much attention, partly because of keen interest in what motivates companies to merge and how mergers affect efficiency.
A view holds that company's merger not just to obtain superior but also to be well-organized. It is argued that mergers allow the banking industry to take improvement of new occasions created
1. INTRODUCTION
1.1 Background of the Study
The Pakistani banking sector has undergone extraordinary transformation over the years, in provisions of number of organizations, ownership constitution, as well as the deepness of operations. These modifications have been prejudiced mostly by challenges pretended by deregulation in policies of financial sector, globalization of procedures, technical innovations and embracing of managerial and prudential necessities that kowtow to international principles.
The wave of merger and acquisitions that currently swept through the banking sector started after the announcement by the state bank of Pakistan, that banks in Pakistan should beef up their minimum capital adequacy ratio should according to bank risk weighted assets or set by SBP.
Mergers and Acquisitions are commonplace in developing countries of the world but are just becoming prominent in Pakistan. Merger and acquisition is simply another way of saying survival of the fittest that is to say a bigger, more efficient, better-capitalized, more skilled industry. Is part of the natural evolution of industries? It is primary driven by Business motives or market forces and Regulatory interventions. The issues therefore , which this study intend to address are whether merger and acquisition will bring about efficient reliable and sound capital base for the bank that fully embraced mergers and to what extend can bank merge boost the confidence of the customers , the investors , the shareholders and ability to finance the real time sector .
1.2 Problem statement
The recent sudden increase of bank mergers in Pakistan is attracting much attention, partly because of keen interest in what motivates companies to merge and how mergers affect efficiency.
A view holds that company's merger not just to obtain superior but also to be well-organized. It is argued that mergers allow the banking industry to take improvement of new occasions created