MERGER AND ACQUISITION IN NIGERIA BANKING INDUSTRY EMPIRICAL STUDY OF THE FIRM PERFORMANCE

ABSTRACT

In order to strengthen the competitive and operational capabilities of banks in Nigeria with a view towards returning global and public confidence to the Nigerian banking sector and the economy in general, the Central Bank of Nigeria instituted a banking reform in 2004, which saw most of the then existing 89 banks merging with each other. This paper evaluates the impact of mergers and acquisitions on performance of Banks in Nigeria. To do this, pre-merger and post-merger financial statements of consolidated banks were obtained, adjusted, carefully analyzed and compared.

      Mergers and acquisitions in the Nigerian banking sector are reform strategies recently adopted to reposition the banking sector. These were done to achieve improved financial efficiency, forestall operational hardships and expansion bottlenecks. The impact of consolidation on bank structure has been obvious, while its impact on bank performance has been harder to discern. The government policy-promoted bank consolidation rather than market mechanism has been the process adopted by most developing or emerging economies and the time lag of the bank consolidation varies from nation to nation. 

     Following the outcome of the Special Joint Examination by the Central Bank of Nigeria (CBN) and Nigeria Deposit Insurance Corporation (NDIC), ten banks were indicted, out of which two were asked to recapitalize, while the Chief Executive Officers (CEOs) and Directors of the remaining eight were removed by CBN based on mismanagement and poor corporate governance. 




TABLE OF CONTENTS
      PAGE 
Title Pagei
Certificationii
Dedicationiii
Acknowledgement iv
Table of Contentsv
List of Table vii
Abstract viii
CHAPTER ONE: INTRODUCTION
Background of the Study1
Statement of Problem 6
Objectives of the Study7
Research Question8
Research Hypothesis9
Scope and Limitation of the Study9
Significance of the Study10
Definition of the Terms10
CHAPTER TWO: LITERATURE REVIEW
2.1 Introduction12
2.2 Concept of Performance Evaluation17
2.3 Approaches to Performance Evaluation20
2.4 Quantitative Evaluation of Merger and Acquisition22
2.5 strength and weakness23
 CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Introduction28
3.2 Research Design28
3.3 Population of the Study28
3.4 Sampling Size and Sampling Technique29
3.5 Data Collection Instrument29
3.6 Questionnaire Design30
3.7 Data Presentation and Analysis of Data30
CHAPTER FOUR: PRESENTATION AND ANALYSIS OF DATA
4.1 Introduction32
4.2 Profitability ratio for FBN Merchant bank32
4.3 Profitability ratios for MBC International bank35
4.4 Profitability ratio for First Bank Nigeria plc37
4.5 Analysis and discussion of findings40
CHAPTER FIVE: SUMMARY, CONCLUSIONS AND RECOMMENDATION
5.1 Introduction47
5.2 Summary of Findings47
5.3 Discussion of Findings48
5.4 Conclusion48
5.5 Recommendation49
5.6 Suggestion for further studies51
            Bibliography52
           Questionnaire58