Effect of Mergers and Acquisitions on the Financial Performance of Commercial Banks in Kenya

Abstract

This examination looked to decide the effect of Mergers and. Acquisitions on the budgetary execution of Banks in Kenya. To accomplish this, the examination talked about the accompanying determinants of budgetary execution: administration productivity; large scale monetary elements; and liquidity. Exact proof has contended that in the present time period by virtue of globalization and mechanical advancement, most affiliations are looked with solid rivalry which undermines their survival in the market and these reasons have driven firms to attempt in Mergers and Acquisitions. The examination was led utilizing an unmistakable research structure. It depended on every Commercial bank in Kenya that have Merged and Acquired somewhere in the range of 2005 and 2017. The examination utilized optional information from evaluated money related articulations, yearly reports distributed by CBK and the particular organization sites. Data accumulated was 3 years pre and 3 years post mixing/getting from the money related declarations of the investigated associations. The examination was disconnected into pre-M&A period and post-M&A period to consider cash related execution when M&A for time of 11 years (2005-2017). The investigation discovered that after merger occasion, all the Commercial Banks detailed an augmentation on the bookkeeping proportions. Besides, in spite of the blended execution, bookkeeping proportions after the procurement was as yet higher contrasted with the execution before the securing occasion. The examination inferred that merger/obtaining occasion enhanced money related execution of the tested business Banks. The investigation prescribed that administration groups need to exploit the benefits of mergers and acquisitions, especially the capacity of extending cash related execution.