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Year of Award

1989

Degree

Master of Business Administration (MBA)

College

College of Business & Professional Studies

Degree Program

Business

Department

Business Administration

Keywords

rate theory, banking, FirstBank, Magna Group, Marine Corporation, Midwest Financial Group

Abstract

From the early 1930's to the mid-1970's banks operated In a highly regulated environment. These regulations protected banks from both geographic and product-line competition and also precluded the banks from horizontal and vertical expansion. Changes in federal and state laws have presented bank managers with opportunities for growth and increased profits. With these opportunities have come challenges.

Numerous studies have been performed in the 1980's analyzing banking organization performance in regards to expansion through merger and acquisition. Characteristics of acquiring and acquired banks have been identified as well as the motives for expansion. Also, methods of entry into horizontal markets along with resulting performance for the bank and the market have been studied.

Proposals for the reorganization of the banking industry in general have been offered in the face of the changing regulatory environment.

On a state level, where allowable banking structure is determined, changes in regulations have permitted banks to expand horizontally. Relatively rapid changes in the Illinois State banking laws have allowed us to examine acquisition efficiency, or lack thereof, over a five year period.

Measuring the change in value for the stockholders from the end of 1983 to year end 1988, it was determined that not all of the gains were based on operating efficiencies, but also by the acquisition value of the respective bank holding companies studied.

Document Type

Restricted Thesis

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