FINANCIAL PERFORMANCE ANALYSIS OF MERGER AND ACQUISITION ON COMMERCIAL BANKS IN NEPAL

Abstract

This study aims to assess the financial performance analysis of mergers and acquisitions involving Nepalese commercial banks. The best output in this study is determined using the CAMELS analysis. The research aims to evaluate the pre- and post-merger performance of the chosen banks and examine the performance of commercial banks. The study is crucial for Nepalese commercial bank management to comprehend the benefits and drawbacks of mergers and acquisitions on bank performance. This helped to improve the performance of the bank. Out of twenty merging commercial banks, two institutions were selected as a sample for the research. The computation of ratios, mean, standard deviation, and paired test was used to analyze the data. Tables with the results were displayed. The study's conclusions support the notion that GIBL and SBL, which acquired their own affiliate banks with significant non-performing asset counts to begin with, did not reap the advantages of their merger. Only in the post-merger phase do ratios pertaining to capital adequacy and liquidity appear to be improving. In a similar vein, the bank has not been able to raise the quality of its assets, and management efficiency ratios have not increased sufficiently. Following the merger, the bank's overall profits capacity and distribution have also declined. Overall, it can be said that the merger has not significantly changed GIBL and SBL's financial performance, at least not least in short run