IMPACT OF MERGER AND ACQUISITION ON FINANCIAL PERFORMANCE OF NEPALESE COMMERCIAL BANKS
Date
2024
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Shanker Dev Campus
Abstract
The objective of study is to investigate whether of the financial performance of the
selected merger and acquisition commercial banks improve after the merger with
camel criteria. The purpose of the study to identify the effect of merger and
acquisition on return on assets and return on investment of Nic Asia Bank Limited
Global IME Bank Prabhu Bank, examine the effect of merger and acquisition on
earning per share and market price per share of Nic Asia Bank Limited Global IME
Bank Prabhu Bank, It is measure the impact of merger and acquisition of NIC Asia
Bank Global IME Bank and Prabhu Bank Limited. The research design of the study is
descriptive and casual. The research has touched upon some of the important human
issues in mergers and acquisitions and thrown some light on managing the human
resource responses as well. Employees seem optimistic regarding the feature of bank.
The researchers suggests for participatory management concept by anticipating and
collecting feedback from employees of merging entities; and it may support in
implementing effective merger and acquisition policy in Nepal. The post merger
performance compared to pre-merger performance witnessed some instability due to
the difference in net earnings. The P/E ratio of NIC-ASIA seems to be increasing
where as the P/E ratio of seems to be decline as well as fluctuating at the existing
price. Thus, there is moderate effect on P/E ratio in post-merger phase. It depicts that
the shareholders are being benefitted in post-merger phase. NIC- Asia seems to
minimally increasing after merger period. NPL to total loan of two sampled banks
seems to be decreasing in post-merger phase. It may be good indicator for the banking
industry. In the initial phase of merger, NIC-ASIA, of NPL to total loan has witnessed
increasing trend and that may be the outcome of merger of banks as they have shared
the liabilities as well. But in following years, the NPL has been decreased and it is the
high-quality indication for banking industry.
Keywords: Merger and Acquisition, Financial Performance, Pre-merger and PostMerger