Impact of merger & acquisition on financial performance: a case study on bank of Ayudhya be acquired by MUFG

Abstract

As we know, the merger & acquisition deals could significantly affect the performance and business result of target company, especially on financial aspect. In fact, merger & acquisition became a major method for expanding business scale, enhancing competitive, improving financial performance. Due to several reasons, regulators did not welcome foreign bank involved too much influence in Thai financial market. In the end of year 2013, a surprising news was revealed in social media, Bank of Ayudhya accepted the investment from Mitsubishi UFJ Financial Group, becoming its oversea subsidiary. It was one of biggest banking merger & acquisition deals in Thailand. My research mainly focus on how the acquisition deal impact on financial performance of Bank of Ayudhya. I applied measurements of financial analysis which represents the aspect of growth, profitability, credit quality, statutory capital and stock performance. In the end, the report stated several changes on financial performance of Bank of Ayudhya after the deal, mostly became better but not comprehensively in every aspects. Meanwhile, the report also provided the recommendations and suggestions for potential readers.