Forced mergers on bank efficiency and productivity: evidence from semi-parametric Malmquist productivity index
The paper examines the impact of mergers and acquisitions on the productivity of the Malaysian banking sector. The analysis consists of two stages. Firstly, the semi-parametric Malmquist productivity index (MPI) method is applied to a [-5, +8] window to examine the efficiency and productivity of the...
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| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
SAGE Publications
2017
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| Online Access: | http://psasir.upm.edu.my/id/eprint/56406/1/Forced%20mergers%20on%20bank%20efficiency%20and%20productivity%20evidence%20from%20semi-parametric%20Malmquist%20productivity%20index.pdf http://psasir.upm.edu.my/id/eprint/56406/ http://journals.sagepub.com/doi/abs/10.1177/0972150916666850 |
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| Institution: | Universiti Putra Malaysia |
| Language: | English |
| Summary: | The paper examines the impact of mergers and acquisitions on the productivity of the Malaysian banking sector. The analysis consists of two stages. Firstly, the semi-parametric Malmquist productivity index (MPI) method is applied to a [-5, +8] window to examine the efficiency and productivity of the acquiring and target banks during the pre- and post-merger periods. Secondly, as suggested by Banker and Natarajan (2008), we employ a battery of parametric and non-parametric univariate tests to examine the difference in the efficiency and productivity of the Malaysian banking sector during the pre- and post-merger periods. We find that the Malaysian banking sector has exhibited a higher total factor productivity level during the post-merger period attributed to technological progress. The empirical findings do not provide conclusive evidence on the less productive banks becoming the target for acquisitions. |
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