ABSTRACT

Banks in Nigeria operate in a dynamic environment affected by myriad of factors. These factors affect the industry in variety of ways creating both opportunities for the strong ones and distress for the feeble banks. However the need to ascertain the effect of merger and acquisition on the growth of Nigerian banks gave rise to this research. In analyzing the above research, the research adopted the following objectives; to examine the effect of merger and acquisition on the profitability of Banks in Nigeria, to evaluate the effect of  merger and acquisition on return on asset of  Banks in Nigeria and finally to determine the effect of merger and acquisition on return on equity of  Banks in Nigeria. The research adopted the use of SPSS to analyze the objectives. Findings reveals that there is a significant different in profit after tax of the bank before and after acquisition, there is a significant change in return on asset of the bank before and after merger and acquisition and finally there is a significant effect of Merger and acquisition on return on asset of Banks in Nigeria. Sequel to the findings and conclusion, the researcher makes the following recommendations; Merger/acquisition is a strategic tool that must be cautiously applied and implemented. The maturation period of the merger must be allowed so that the financial records of the intending firms coming together can be properly scrutinized by the board of directors of each firm and the regulatory agencies.

TABLE OF CONTENTS

CHAPTER ONE

INTRODUCTION

1.1 Background to the Study                                                                                                        1

1.2 Statement of the Problem                                                                                                       2

1.3 Objectives of the Study                                                                                                          3

1.4 Research Questions                                                                                                                 3

1.5 Research Hypotheses                                                                                                              4

1.6. Significance of the Study                                                                                                      4

1.7 Scope of the Study                                                                                                                  5

1.8 Definition of Terms                                                                                                                 5

CHAPTER  TWO

REVIEW OF RELATED LITERATURE

2.1 Conceptual Framework                                                                                                          6

2.1.1 The Concept of Merger and Acquisition                                                                            6

2.1.2 The Rationale for Merger and Acquisition.                                                                        7

2.1.3 Classification of Merger and acquisition                                                                            9

2.1.4 Benefits of Merger and acquisition                                                                                     9

2.1.5 Effects of Merger and acquisition                                                                                     10

2.2   Theoretical Framework                                                                                                       11

2.2.1 Bank concentration Theory                                                                                                11

2.2.2 Pro-concentration theory                                                                                                     12

2.2.3 Pro-deconcentration theory                                                                                                  12

2.2.4 “Eat or be Eaten” theory of Merger and acquisition and acquisitions                                 13

2.2.5 Agency Theory                                                                                                                     15

2.3   Empirical Review                                                                                                                  16

 

 

 

 

 

CHAPTER  THREE

 METHODOLOGY                                                                                                              22

3.1       Research Design                                                                                                         22

3.2       Area of Study                                                                                                             22

3.3       Source of Data                                                                                                                        22

3.4       Population of the Study                                                                                              22

3.5       Sample Size                                                                                                                 22

3.6       Data analysis Technique                                                                                              22#

CHAPTER FOUR

DATA PRESENTATION AND  ANALYSIS                                                                   24

4.1 DATA PRESENTATION                                                                                                            24

4.2 Test of Hypothesis                                                                                                                        24

4.3 Discussion on Findings                                                                                                     28

CHAPTER FIVE                             

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS                       30

5.1 Summary of Findings                                                                                                        30

5.2 Conclusion                                                                                                                                    30

5.3 Recommendations                                                                                                             30

REFERENCES