Mergers in Indian Banking Sector Benefits and Motives

Abstract

This paper gives you an insight into the motives and benefits of the mergers in Indian banking sector. This is done by examining the eight merger deals of the banks in India during the period of reforms from 1999 to 2006. This paper also uses the empirical methods T-test to study the short term change in the returns of the banks due the merger and EVA (Economic Value added) method to study the efficiencies or benefits achieved due to the merger. Through this paper and the sample taken for analysis it has been concluded that the mergers in the banking sector in the post reform period possessed considerable gains which was justified by the EVA of the banks in the post merger period .

Keywords: Merger, Banking, Indian, EVA, Motives, Benefits