The Effects of Cross-Border Bank Mergers on Bank Risk and Value

34 Pages Posted: 3 May 2002

See all articles by Yakov Amihud

Yakov Amihud

New York University - Stern School of Business

Gayle L. DeLong

City University of New York, Baruch College - Zicklin School of Business - Department of Economics and Finance

Anthony Saunders

New York University - Leonard N. Stern School of Business

Multiple version iconThere are 4 versions of this paper

Date Written: March 2002

Abstract

This paper examines the effects of cross-border bank mergers on the risk and (abnormal) returns of acquiring banks. We find that overall, the acquirers' risk neither increases nor decreases. In particular, on average neither their total risk nor their systematic risk falls relative to banks in their home banking market. The abnormal returns to acquirers are negative and significant, but are somewhat higher when risk increases relative to banks in the acquirer's home country.

Keywords: Banks, Mergers, Market reaction, International business

JEL Classification: G14, G21, G34, F23

Suggested Citation

Amihud, Yakov and DeLong, Gayle L. and Saunders, Anthony, The Effects of Cross-Border Bank Mergers on Bank Risk and Value (March 2002). Available at SSRN: https://ssrn.com/abstract=307463 or http://dx.doi.org/10.2139/ssrn.307463

Yakov Amihud

New York University - Stern School of Business ( email )

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Gayle L. DeLong (Contact Author)

City University of New York, Baruch College - Zicklin School of Business - Department of Economics and Finance ( email )

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HOME PAGE: http://faculty.baruch.cuny.edu/gdelong

Anthony Saunders

New York University - Leonard N. Stern School of Business ( email )

44 West 4th Street
9-190, MEC
New York, NY 10012-1126
United States
212-998-0711 (Phone)
212-995-4220 (Fax)

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