Effects of Bank Mergers and Acquisitions on Small Business Lending in Nigeria
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Merger and Acquisition (M&A) is one of the instruments of the recent banking reforms in Nigeria. One of
the implications of the reform is its effect on the lending to small businesses, which was divided into
static and dynamic effect (restructuring, direct and external) in this study. Data were collected by crosssectional
survey research design and were subsequently analyzed by the ordinary least square method.
The analyses show that bank size, financial characteristics and deposit of non-merged banks are
positively related to small business lending, while for merged banks the reverse is the case. From the
above result, it is evident that M&A have not only static effect on small business lending but also
dynamic effect, therefore, given the central position of small businesses in the current government
policy on industrialization of Nigeria, policy makers in Nigeria should consider both the static and
dynamic effects of M&A on small business lending in their policy thrust. JEL: G21
Keywords
HF5601 Accounting