THE DETERMINANTS OF BANK RATING CHANGES: AN ANALYSIS OF GLOBAL BANKING MERGER AND ACQUISITION (M&A)
THE DETERMINANTS OF BANK RATING CHANGES: AN ANALYSIS OF GLOBAL BANKING MERGER AND ACQUISITION (M&A)

Summary/Abstract: This study reviews the ordered logit model with a marginal effect to assess the changes in the overall credit ratings by comparing premerger and acquisition (M&A) with that post-M&A performance from the perspective of the acquiring banks. Efforts should be made to identify the key elements that influence the successful ratings of an appropriate M&A strategy. The CAMEL criteria are referable for bank rating determination in terms of pre-M&A performance. Moreover, capital adequacy and liquidity should be taken into account for the economy scale of M&A performance because capital soundness accelerates the accomplishment of an M&A by creating synergy.

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