Facoltà: Economia Aziendale e Management - Classe LM-77
Collocazione: 20458
Autore: Guslini Andrea
Data: 19/07/2022
Titolo: The impact of merger & acquisition in Italian banks
Relatore: Sartori Massimiliano
Autorizzazione per la consultazione: SI
Le tesi si possono consultare unicamente in sede
This paper has the objective to study the Merger and Acquisition transaction in Italian banks to understand if it is an efficient strategy to expand their business and improve their financial position. The study is based on the research question: “What is the impact of M&A operations on the evolution of Italian banks' profitability and productivity?”. Moreover, are developed the following sub-question in order to structure the analysis: • What are the main reasons that lead a bank to carry out an M&A operation? • Which are the best ratios to analyze bank’s profitability and productivity? • What are the fundamental elements that influence the bank’s performance? The paper starts with a description of the recent literature, with the aim to comprehend what are the principal aspects on which scholars focus their attention. In addition, this process helps to understand the gaps that previous studies have created. In the first chapter are also presented the general M&A theories and it is presented the history that this phenomenon had in the US market. The study continues with the description of the methodology, in which are taken as reference, papers of economists, who in the past years decided to use the Event Study methodology to analyze what are the drivers that contribute to the improvement or deterioration of the banks’ performance. Next, are defined the 50 M&A operations which are included in the sample describing the data collection process employed, and the model specification, which allows the reader to understand the criteria used to select the bidder banks for further analysis. It is, then carried out a study of the most important Profitability and Productivity ratios to grasp what are the most suitable financial indexes for the thesis objective. The study carried out to answer the research question starts with a statistical study in order to have a summary of the principal characteristic of the sample. It is then made a correlation between the Profitability and Productivity ratios, highlighting the differences between Pre and Post M&A values. The paper continues with an Event Study, which is the key analysis of the study. Thanks to the process performed it was possible to reject the hypothesis and asses that M&A operations in Italian banks increase Profitability and Productivity ratios taken into account. The last analysis consisted of multiple regression models to evaluate what are the variables that most impact the banks’ performance after the transaction. These models help also to define what are the control variables that have a positive impact on the explanatory capacity of the regressions. The regression models shows that Turnover and Assets have a positive impact on the Profitability ratios, while Equity deteriorate the index value. Regarding the Productivity, the Equity instead has a positive impact and improve the financial performance of the bank. In addition thanks to the use of control variables emerge that Share Capital, Stock Exchange listing and Number of Employees impact financial result.
