Effects Of Cross Border Bank Mergers On Performance - Free Essay Example

Sample details Pages: 6 Words: 1941 Downloads: 7 Date added: 2017/06/26 Category Finance Essay Type Research paper Did you like this example? BACKGROUND: Being a developed economy the European Banking sector is undergoing a process of restricting which may be mainly because of ever permanent trends like disintermediation, deregulation and the ever increasing competition and the very obvious proof of this restricting is the increasing number of mergers and acquisitions. I f we look back we will find out that from the year 1995 to the first half of the year 2000, 2153 mergers and acquisitions were recorded in the European Union of credit institutions out of which 1807 were domestic merger deals out of the remaining 346 cross border bank mergers , a large majority took place outside Europe. Looking at the history of European banking we will find out that cross border mergers and acquisitions have always been outnumbered by domestic bank mergers and acquisitions .An obvious motive of cross border bank mergers can be said to be diversifying the country inherent risk as a more stable profit can be generated by geogra phical diversification. Moreover cross border mergers and acquisitions explore the economies of scale, have a positive effect on the X- efficiency of the merging banks. The main cause of banks entering into cross border mergers can be attributed to factors like the size of the foreign markets, the presence of non financial firms abroad and the presence of entry restrictions, a comparative advantage due to superior skills can also said to be one of the reasons as to why banks go for cross border mergers. If we take into account the cross border banking in Europe we will find out that it is mainly restricted to European banks only, most of the foreign banks in Eastern Europe are West European Banks. There is a total of 25% of regional component of European banks within Europe. If we take into account the picture of European banking we will find out that currently 11 banks operate in the European market, earlier this number was 7 and it is indeed remarkable that increased to 11 during the period of recession by and a total number of 3 banks operate on a global scale. AIMS AND OBJECTIVES OF THE RESEARCH: The main aim of my research is to throw light on the cross border bank mergers which have taken place in the European Markets. In my dissertation I will be mentioning about what drives the banks to enter in to cross border mergers and acquisitions, what factors are taken into consideration by both the banks before entering into the deal and the post merger effects on the performance of the banks, for supporting this Ià ¢Ã¢â€š ¬Ã¢â€ž ¢ll be taking into account the cross border bank merger of Abbey National(Spain) and Santander (UK). The main objective of my research will be to find out the reasons and causes of the infrequent cross border bank mergers and acquisitions in the European markets over a period of time as compared to other markets worldwide. REVIEW OF LITERATURE: Over a number of years a lot of research has been done on the effects of cross border bank mergers on the performance of the host and the target bank post the merger and the effects have been studied and analyzed from the cross border bank merger deals in the Europe. It has come to light that the foreign banks in the emerging economies tend to perform better than their domestic counterparts. Researchers have found out that the main motive behind the banks entering into cross border bank mergers can be factors likeà ¢Ã¢â€š ¬? follow your customer hypothesisà ¢Ã¢â€š ¬? (Miller and Porkhe, 1998) or it can be attributed to the difference in the efficiency between the acquiring and the target bank(Berger, 2000). In another study by Claessens and Van, it has been argued that competitive advantage to the banks is another motive of cross border bank mergers and apart from that it has been seen that multinational banking moves usually to those countries where there is a similar environment as they face in the home country. During the past decade the European financial s ector has been affected quite significantly by mergers and acquisitions. There has been a substantial growth of 67% in banking assets as a percentage of GDP, but there was a decline in the number of European banks from 12,670 in the year 1985 to 8395 in the year 2000. There has been a constant consolidation in the banking sector all around the globe; basically it involves different banks entering into mergers and acquisitions. In the European Union itself the number of banks came down quite sharply from 11397 in 1990 to7045 in the year 2006 and at the same time some of the large banks entered into cross border mergers. Researchers have found out that in the European market 11 banks operate on the European scale and 3 banks on the local scale. A few years back it was taken into account by (Walter, 2003) that mergers and acquisitions activity in Europe is primarily domestic. When we talk about domestic orientation then European banks have a small domestic component of 54%. Half of the top 30 banks in Europe are international and there have been some very successful cross border deals including the takeover of Abbey National (UK) by Santander (Spain) in the year 2004, the takeover of Banca Antonveneta( Italy) by ABN Paribas(France) to name a few. The Case of Banco Santander and Abbey National: On July 26 2004 Banco Santander of Spain acquired Abbey National of the UK and it was the first pan European bank takeover, it was a boon for Santander as it opened a pathway for them to enter into Britainà ¢Ã¢â€š ¬Ã¢â€ž ¢s retail banking sector. Abbey National was acquired with a total share package of $ 16.1 billion. Two years prior to the merger Abbeyà ¢Ã¢â€š ¬Ã¢â€ž ¢s operations were showing loss due to the condition of inefficient market so if we see it in that context then the merger may be an opportunity for them to get stabilize their performance. People had different views regarding this takeover some of them praised Santander for stepping foot into the Europe an markets and on the other hand Abbey was criticized that for merging with Santander when it always had other options. Shares worth $16.1 billion were issued to finance this deal and it was decided that the shares will be exchanged with the shares of Abbey on a one to one basis. After the deal had been struck I was decide that the shareholders of Santander will hold 76.4% of the total capital and the shareholders of Abbey National will be holding 23.6%. However as far as bank management is concerned it was decided that Santander will have full control over bank management, it will bring over ità ¢Ã¢â€š ¬Ã¢â€ž ¢s own corporate culture and organizational ways in order to control costs but the brand Abbey will be retained. Alferdo Sainz, the vice president of Santander said thatà ¢Ã¢â€š ¬? What we know best is commercial banking, which contributes 85% of our profits. That is what we are going to do with Abbey. It is a very important brand that has under-utilized potential.à ¢Ã¢â€š ¬? In my dissertation I will be taking into consideration the performance of Banco Santander and Abbey National post merger and throwing some light on the positive and negative impacts of this deal on both the banks. We can without a doubt say that the picture of cross border banking is diverse. There are very limited global players I commercial banking and some large European banks like ABN Amro have a global reach. It has been seen that most of the times the acquiring banks are larger in cross border deals as compared to domestic deals ( European Commission, 2005), and the target banks are more or less of the same size and it has come to light that the target firm enjoys the majority of ownership in cross border deals. However still the literature and research work on the cross border banking in the European union is still less as compared to the research on the takeovers in US and moreover not much emphasis has been laid upon the fact that what are the effects on the acquiring and the target banks post merger and infrequent cross border bank mergers in the European market so therefore my research question is the Post Merger effects of cross border bank mergers on the bankà ¢Ã¢â€š ¬Ã¢â€ž ¢s performance in the European Market and what is the root cause of infrequent cross border bank mergers in the European market. RESEARCH METHODOLOGY: As far as my research methodology is concerned I will be taking into account both primary and secondary data. Secondary Data will be used to throw some light on what drives the bank to enter into cross border deals and what factors do the banks take into consideration before entering into cross border deals, and apart from that secondary data will be of much help to me in finding out the main factors which determine cross border bank merger deals. Whereas I will be using Primary data while focusing on the post merger effects on bankà ¢Ã¢â€š ¬Ã¢â€ž ¢s performance and while answering my research question that what are th e causes and reasons for a low number of cross border bank mergers in the European market as compared elsewhere, basically I will be focusing on the Quantitative research for collecting of data related to my research question which will involve interviewing people, analysing their point of view and then finally including it in my dissertation. Apart from this I will be contacting the banks which have entered into cross border deals and try to get some useful information from them and imply it in my dissertation. Apart from this I will be referring to authors who have done some prior research on cross border bank mergers and last but not the least the University of Bedfordshire Library will be of great help to me while completing my dissertation. Structure Plan: In my Dissertation first of all I will starting with the introduction part in which I will be mentioning about the history of cross border bank mergers worldwide and taking special notice of the European market I will be f ocusing on the trends of cross border bank mergers over a period of time and how it has evolved, then I will be mentioning about the favorable market conditions for cross border bank mergers in Europe. Then comes the Literature Review in which I will be throwing light on what researchers and other analysts have said related to my topic . In the main body I will be talking about the factors which drives the banks to enter into cross border mergers, then I will be mentioning about the determinants of cross border bank mergers where light will be thrown on factors concerning to both acquiring and the target banks to enter into a deal. Then I will be focusing on my research question about the post merger affects on the performance of both acquiring and the target banks taking into consideration the case of Banco Santander and Abbey National , following this will be my second research question as to what are causes of infrequent cross border bank mergers in the European market and after answering both the questions I will be giving the much needed conclusion and the Bibliography. I will be starting with my dissertation from the mid of June and I expect to end my work in the first week of September. For the first two months I will be taking time to collect sufficient data to support my research and then I will be implying the data collected into my research to complete my dissertation. I am mentioning two months time but it may be possible that it may take more time to collect data as contacting people and taking their feedback requires a lot of time. Don’t waste time! Our writers will create an original "Effects Of Cross Border Bank Mergers On Performance" essay for you Create order

Civil Liberties And Multiculturalism The Freedom Of The...

Sara Racchi Professor Vinecour Civil Liberties Multiculturalism INSERT DATE INSERT TITLE While speaking about the University of Virginia, Thomas Jefferson once said, â€Å"This institution will be based on the illimitable freedom of the human mind. For here we are not afraid to follow truth wherever it may lead, nor to tolerate any error so long as reason is left free to combat it.† ( ) What Jefferson understood, along with the other founding fathers, is college is meant to be a forum for diverse ideas and challenging one’s preconceived beliefs. That’s why for many Americans, the First Amendment is the most important of all the rights guaranteed by the constitution. Moreover, it preserves our natural desire to express our thoughts and†¦show more content†¦These charges brought against Brandenburg came forward after he phoned a reporter from a television station based out of Cincinnati, requesting for them to cover one of his KKK rallies on their program. The reporter accompanied alongside one camera man accepted the invitation t o the rally which was being held on a farm in Hamilton County (Justia). The footage documented exposed twelve men dressed in full Klan regalia, some of which possessing firearms including a shotgun, a rifle, a pistol, ammunition as well as a bible. The ruling on the case came on June 9, 1969 and sided with Brandenburg and stated the Ohio law for criminal syndicalism was defined in too broad of terms and could not prove he was promoting violence. As a result, the state of Ohio was in violation of Brandenburg’s First Amendment right (oyez.org). In what has become known as the â€Å"Brandenburg test† the ruling has set a standard for how courts will determine if speech is meant to incite violence or not (Pew). The qualification for promoting lawless action is the message of the speaker must support an â€Å"imminent† action of violence (Pew).This case set a clear standard for the protection of one’s freedom of speech no matter how in conflict it may be wit h other’s beliefs and opinions. It also clarified how to interpret the intentions of any speech without the speech maker fearing arbitrary accusations of advocating lawlessness. II. Healy vs. James TheShow MoreRelatedMulticulturalism And The Future Of Multiculturalism3561 Words   |  15 Pagesand future of multiculturalism. Cultural diversity from very beginning was existing in different nation There are Jews in Germany, Poles in Ireland, Asians in Canada and so on but the level at which Multiculturalism have reached today became a political issue for those countries which have cultural diversities. People of different cultural diversity are enjoying the same rights and people are practicing different cultures as and extended form of their liberty. People have the freedom to do whateverRead MoreAfrican Americans2313 Words   |  10 PagesJourney from 1865 to the Present HIS: 204: American History Since 1865 Professor Lisa Burgin July 14, 2014 Introduction The African American journey has been one of trials and tribulations which they suffered greatly to achieve freedom and success. The battle has led the citizens of this nation to have witnessed the first African American President of the United States. The journey that has brought African Americans to the present situation has seen intermittent successes andRead MoreSocial Orders And Its Effects On Society Essay2086 Words   |  9 Pagesequivalent in rights, poise, and the possibility to accomplish incredible things. To genuinely open doors that have been locked for centuries, requires that we have to rise to access to the regale, weights and obligations of our public paying little mind to race, sex, class, religion, sexual introduction, inability, or different parts of what we look like or where we originate from. Individuals have constantly realized that imbalance is divisive, socially destructive and comprised of multiple dimensionRead MoreDevelopment Of Indi A Critique Of Nehr uvian Model Essay3508 Words   |  15 Pagesstatecraft as a Prime Minister can be analysed through his personal life itself. Nehru was a great nationalist leader widely known by his personality and intellectualism. He proved himself as a practical tinker and a leader. His long association with the freedom struggle and with the then intellectuals shaped his democratic political thought. His political ideas evolved in different phases of his association with public life. His was not very influenced by the moderate leaders of the Congress rather realizedRead MoreIntroduction to Racism3331 Words   |  13 Pages_Toc336445255 h 12 HYPERLINK l _Toc336445256 References PAGEREF _Toc336445256 h 14 Introduction to Racism Racism is one of the bitter and harsh realities that cannot be ignored or neglected due to the reason that it has existed since the human has first walked on earth and is still being practiced in many parts of the globe. Racism can be defined as the principle that a person or a community is superior or mediocre from others because of color, language, traditions, place of birth and variousRead MoreA Nation Of Immigrants And The United States Of America2299 Words   |  10 PagesPlato Unit Activity Give me your tired, your poor, Your huddled masses yearning to breathe free... -- Emma Lazarus (from the poem The New Colossus) These words by Emma Lazarus, inscribed on a plaque on the Statue of Liberty, strike a chord of yearning for freedom in the minds of suffering yet hopeful people, and invoke a picture of the United States meeting the immigrant with open arms. The United States is often called a nation of immigrants, and yet US history reveals many examples of anti-immigrantRead MoreLee Daniels The Butler3535 Words   |  15 Pagesoppression to serve for eight presidents as a butler in the White House. The film focuses on African American historical events, with special concentration on the civil rights era. With the White House segments of the film starting in the oppressive Eisenhower years, it offers a presidential level insight into the historic freedom movements of the 1960’s, all the way through until the day that Barack Obama is elected president in 2008. I am going to argue that Daniels’ representation of historyRead MoreEssay on Diversification within American Organizations5630 Words   |  23 Pagesthat emphasizes power, authority, and responsibility and women were suppose carry roles such as teaching, caring for patients, and helping the les fortunate. Others see the issues of diversity primarily in strategic terms. Organizations compete for human resources and as the workforce becomes more diverse, organizations will have to serve the diverse needs of this workforce or they will lose them to their competitors. Organizations that discriminate against wome n are forced to select workers from aRead MoreRacism on College Campuses4582 Words   |  19 Pagesuse as an unquestioned general descriptor overlooks how these moments of scandalous social interactions work to replay and reinforce longstanding ideas of national belonging and so-called racial truths. Despite the tremendous strides resulting from civil rights legislation, racism remains one of the most pressing social problems in the US (Jackson Solis, 1995). No setting is immune and college campuses have found themselves embroiled in the discussion. Racial issues are significant in all aspectsRead MoreA Study On A Culture Of Peace10177 Words   |  41 Pagesthis regard, Bowden (2001) indicated that by the year 2000 over half of the countries in Africa and 20 percent of the population were affected by violent conflict and the extent of conflict was greater than in any other region in the world. Recently, human casualties are also continuing in many countries in the world through violence and violent conflicts. In this regard, the UCDP conflict encyclopedia portrays that in recent years there are different kinds of conflicts in many countries of the world

Cornell Supplement- College of a and S free essay sample

Through my enrollment in Cornell University College of Arts and Sciences I feel that I would be able to engage in an academically and artistically dominating English program unique to that offered by other Universities. This would enable me to not only investigate and extend my abilities and intrigue with English, but my other academic interests.In this specific College, I strongly believe that I would be able to engage and challenge myself through the divergence into the myriad of academic course offerings of the College of Arts and Sciences. Despite my incredible enthusiasm for writing and similar arts and studies, I also share a myriad of other interests coincidentally offered y the College of Arts and Sciences. The diversity of the College is best suited to my personality. Am a driven young woman, always seeking out challenges and opportunity to push myself to the next level. At this University and College of Arts and Sciences in particular, I am positive I would be able to positively promote academic and mental stimulation and growth on the personal level. We will write a custom essay sample on Cornell Supplement- College of a and S or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Although I know I will always be beguiled and compelled by the English language, continuously finding freelance writing jobs as do now tit local blobs and publications, or the continuation with my work as a childrens programmer at my library, firmly believe that my abilities and love for English could be refined further.To be honest, had always perceived Cornell University as an unattainable, distant dream If I had anticipated studying something in a field of science or mathematics. However, upon my reading of Kosher Chinese by Cornell graduate Michael Levy, who attended Cornell as an English and History major, I was intrigued to further research Corbels academic offerings for English studies. I then became very drawn to Cornell as a viable option for college choice.Cornell Universitys College Of Arts and Sciences would be the pinnacle and optimal choice for my hopeful enrollment to study English, a major unique to this specific College. Through my study here, I trust that my offerings to and from Cornell will be most beneficial through my study in the College of Arts and Sciences for the incredibly diverse offerings of the College that caters to the wide range of my academic and extracurricular interests.