Performance Analysis Of The Consolidation Of Indian Public Banks: A Comparision Of Pre – And – Post Merger

Abstract

Globalisation and liberalisation have led to significant developments in the banking industry over the past two decades, including the elimination of entry barriers, the introduction of new financial products and services, and technical advancements. Banking consolidation involves fewer banking businesses and deposit-taking institutions, resulting in larger, better-capitalized entities with more market concentration in deposits, loans, and operations. This research compares the performance of merging nationalised banks in India before and after merger based on many factors, including net profit ratio, return on equity, return on assets, earnings per share, and profit per employee. The research covered Punjab National Bank, Canara Bank and Union Bank. The paired t-test revealed that the merger had a negative impact on net profit ratio, return on equity, and return on assets, but a favourable impact on earnings per share and profit per employee.