Abnormal Stock Market Returns to Announcements of M&A Banking Deals in Greece 1996-2013 (original) (raw)

This study has undertaken a comprehensive empirical analysis of the wealth effects of bank M&As in Greece over the period 1996-2013 and it reports insignificant abnormal gains for acquiring banks, significant positive abnormal returns at 7,44% for acquired banks, and 2,91% positive abnormal returns for the combined entity, in the event window [-10;+1]. The findings indicate that, on average, the Greek bank mergers neither create nor destroy shareholder wealth. This result is consistent with the findings of other Greek event studies, and the bulk of US and European event studies on M&A wealth effects. On average, acquired firm shareholders gain at the expense of the acquiring firm and market value of the combined entity appears to have little improvement around the announcement of the transaction. Yet, mergers continue so there is scope to investigate other motives that drive M&As in the banking sector.