Title: Bank consolidation: significance, valuation and consequences

Authors: Alen Stojanovic, Anita Pavkovic

Addresses: Graduate School of Economics and Business, University of Zagreb, J.F. Kennedy Sq. 6, Zagreb 10000, Croatia. ' Graduate School of Economics and Business, University of Zagreb, J.F. Kennedy Sq. 6, Zagreb 10000, Croatia

Abstract: The growth of efficiency and profitability are basic goals of every bank management. The prevailed opinion is that these aims can be realised through the growth in scale and scope of their business operations. This growth can be internal – by increasing the scope and the number of own activities, or external – by taking over or acquiring business activities of other companies. The latter form of growth, consolidation or conglomeration, is becoming more and more important. The purpose of this paper is to point to the main causes, motives and characteristics of banking conglomeration, a phenomenon that has prevailed in developed financial systems and has growing importance in transition and other less-developed countries.

Keywords: bank consolidation; mergers; acquisition; valuation; efficiency; banking conglomeration; transition economies; emerging economies; bank management.

DOI: 10.1504/IJEPEE.2009.030578

International Journal of Economic Policy in Emerging Economies, 2009 Vol.2 No.3, pp.281 - 301

Published online: 24 Dec 2009 *

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