Munich Personal RePEc Archive

Is M&A different during a crisis? Evidence from the European banking sector

Beltratti, Andrea and Paladino, Giovanna (2011): Is M&A different during a crisis? Evidence from the European banking sector.

[img]
Preview
PDF
MPRA_paper_35065.pdf

Download (117Kb) | Preview

Abstract

The financial crisis has affected the landscape of the banking sector around the world. We use a sample of transactions taking place in Europe in 2007-2010 to study the acquirer’s stock price market reaction to announcements and completions of acquisitions. We find that there are no significant abnormal returns around the announcement of an acquisition while there are positive abnormal returns at completions. We study the cross-sectional determinants of abnormal returns and find that announcement returns are mainly explained by the acquirer bank characteristics, while completion returns depend on opacity of the target and in large part on the drop in volatility associated with a reduction of uncertainty.

UB_LMU-Logo
MPRA is a RePEc service hosted by
the Munich University Library in Germany.