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The Response of Performance to Merger Strategy in Indonesian Banking Industry: Analyses on Bank Mandiri, Bank Danamon, and Bank Permata

Gadjah Mada International Journal of Business

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Title The Response of Performance to Merger Strategy in Indonesian Banking Industry: Analyses on Bank Mandiri, Bank Danamon, and Bank Permata
 
Creator Lestari, Murti
Arsyad, Lincolin
 
Description This study analyzes the responses of performances of BankMandiri, Bank Danamon, and Bank Permata to merger strategy.This paper harnesses the quantitative approach with structuralbreak analysis method and impulse response function. Theplausible findings indicate that the merger of Bank Permataproduces a better performance response in comparison to theconsolidation of Bank Mandiri and the merger of Bank Danamon.The merger of Bank Permata does not result in performanceshocks, and the structural break does not prevail either. On theother hand, the consolidation of Bank Mandiri and the mergerof Bank Danamon result in structural breaks, particularly in thespread performance. In order to return to the stable position, themergers of Bank Mandiri and Bank Danamon require a longertime than does the merger of Bank Permata. This researchindicates that for large banks, the mergers and acquisitions(retaining one existing bank) will deliver a better performanceresponse than will the consolidations (no existing bank).Keywords: impulse response function; merger; structural break
 
Publisher Master of Management, Faculty of Economics and Business, Universitas Gadjah Mada
 
Date 2010-05-12
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://journal.ugm.ac.id/gamaijb/article/view/5510
10.22146/gamaijb.5510
 
Source Gadjah Mada International Journal of Business; Vol 12, No 2 (2010): May - August; 231 -255
2338-7238
1411-1128
 
Language eng
 
Relation http://journal.ugm.ac.id/gamaijb/article/view/5510/4482