The Effect of Merger on Deposit Money Banks Performance in the Nigerian Banking Industry
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Abstract
Description
The study objective gives an insight into the effectiveness of economic policy reforms in
the Nigerian banking industry. This study examines the impacts of merger on deposit
money banks performance in Nigeria between 2000 and 2009. The period was
characterized by financial deregulation, the Global economic crisis, and bank
restructuring programs. The panel data ordinary least squares approach is the
methodology employed to investigate if there is any significant effect on the performance
of banks from the pre to the post merger periods, in order to detect whether bank mergers
produce any performance gains in the Nigerian banking industry. The evidence shows that
merger created synergy as indicated by the statistically significant increasing post-merger
financial performances although banks should not jump at any merging opportunity that
offers itself because the exercise is not an opportunistic one. We therefore recommend
that merger being a relatively new phenomenon in the Nigerian banking environment
should be given more encouragement by the regulatory authorities.
Keywords
H Social Sciences (General), HF Commerce, HG Finance, HJ Public Finance