Pre and post merger financial performance analysis of state bank of India

With the globalization of the economy, increased competition from both foreign and domestic banks and robust technology, there has been rapid change in the business environment of banking industry in last two decades. In order to overcome these challenges successfully, most of the banks have adopted a corporate restructuring strategy like merger and acquisitions. The purpose of the present paper is to analyze the pre and post merger financial performance of State Bank of India with the help of various financial parameters such as investment ratios, management efficiency ratios, debt coverage ratios, leverage ratios, profitability ratios and profit and loss account ratios. Paired sample t-test is applied for the purpose of testing the statistical significance of various parameters. The study is based on secondary data covering eight years annual data of pre and post merger period. The study reveals that the State Bank of India (SBI) does not shows significant improvement in the financial performance in the post merger period. There are some of the financial parameters have shown significant improvement during the post merger period while most of the parameters have not shown significant improvement during the post merger period.