Mergers and acquisitions: An application on bank mergers and acquisitions in Turkey.

Global economic and social changes have direct influence on the management science while search for innovation affect all the actors of the financial markets. Globalization has made the financial market a large capital pool where a lot of companies now consider partnerships, mergers and acquisitions.Banks, which act as the backbone of the financial system, intervene with mergers and acquisitions at a higher rate in order to better meet the considerations of the industry and the competition. Like all around the world, in Turkey especially in financial sector, acquisitions carried out in various sectors. The post-crisis restructuring efforts include merger and acquisition strategies for Turkish Banking Sector.This study aims to identify the effect of mergers acquisitions and share transfers on the performances of the Turkish Banks between 2001-2012. Probit Model has been used in order to identify the performance changes of the 9 banks that were subject to merger and acquisition. Independent variables within the study include Capital Adequacy Ratio, Fixed Assets/Total Assets, Financial Assets / Total Assets, Interest Income / Total Assets, Liquid Assets/Short-term liabilities, Net Profit / Assets (ROA), Net Profit / Equity (ROE) . Based on the analysis, ratios such as Fixed Asset / Total Asset, Interest Income / Total Asset, Liquid Assets / Short Term Liabilities face a decreasing effect after the merger/acquisition activity. Key Words: Turkish Banking Sector, mergers, acquisitions, Probit Model