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Journal of Financial Economics Vol. 31 No. 2 1992

Changes in corporate performance associated with bank acquisitions

Marcia Millon Cornett1,2; Hassan Tehranian1,2

1 Boston College · 2 Southern Illinois University Carbondale

Abstract

This paper examines the post-acquisition performance of large bank mergers between 1982 and 1987. On the whole, the merged banks outperform the banking industry. Their better performance appears to result from improvements in the ability to attract loans and deposits, in employee productivity, and in profitable asset growth. Further, we find a significant correlation between announcement-period abnormal stock returns and the various performance measures, showing that market participants are able to identify in advance the improved performance associated with bank acquisitions.

DOI
10.1016/0304-405x(92)90004-h
Volume
31
Issue
2
Pages
211-234
Language
en
Sources
bibtex:phds-export.bib openalex crossref

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