A nivel nacional y local

O f the 250 bank holding companies invited, 70 did not have any acquisition

experience after 1985 and 16 were acquired during the invitation period. Fifty-one o f the

164 institutions that formed the relevant universe agreed to participate, for a 31.1% 61

response rate and coverage o f 44.6% o f the industry’s assets. The asset size o f the

smallest invited institution was about $400 million, which implies very rare acquisition

activity and very small transaction sizes (usually one or two branches). Further

extensions o f the sample to smaller institutions were likely to have resulted in very few

responses, because o f the scarcity o f acquisitive events, and in significant loss o f

comparability between the transactions analyzed.

The experience base o f the banks participating in the study ranged from very low

(5 o f them have only one acquisition experience) to very high, with 10 o f the 12 largest

and most active acquirers in the industry represented in the sample. The total number o f

acquisitions completed by the 51 banks was 577, a sample large enough to ensure that

routinization o f the acquisition process was possible at least for a subset o f the firms. In

relation to the original population o f the 250 largest institutions, the sample o f

respondents was biased with respect to their asset size (participants were significantly

larger than non-participants, p < .05). but the differences in the means o f ROA, ROE, and

efficiency ratios are not statistically significant.

Great care was taken to single out the best available respondent in each

participant organization, particularly for the Phase 1 survey. For the large banks, that

was a difficult task, as roles and functions were often idiosyncratic to these firms’

internal organizational arrangements. In some cases, the survey completed by one

individual (responsible, for example, for the M&A group) was double-checked by a peer

colleague who had been involved in post-acquisition integration processes. The problem

was compounded by the fact that the search for the best respondent was typically brought

to a senior executive who, though generally intrigued by the research project, had a long

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list o f priorities to which he/she had to allocate scarce available time and attention.

Nonetheless, Phase 1 documents were completed by highly competent individuals.

Typically, the coordinator o f the post-acquisition integration processes (such a function

was present in 14 of the firms surveyed) or the manager responsible for the corporate

development unit or for the M&A group (26 cases) filled out the survey. In the smaller

and less experienced organizations, the survey was completed by the CFO or controller

(nine cases), or the CEO him self (three cases), who typically spearhead the M&A process

when such events occur.

The price paid for the “tailored” survey approach, based on very frequent rounds

o f telephone contacts to check on both the status (pre-) and on the quality (post-) of

survey completion was correspondingly high. It took one year, from summer 1995 to

summer 1996, to complete Phase 1 and another year to complete Phase 2. Also, the

response rate for Phase 2 was significantly lower than that for Phase 1, as only 30

institutions completed the much more intense and time-consuming exercise o f gathering

detailed data on several acquisitions from four different organizational functions.

Another explanation for this drop in participation is the long time frame necessary both to

gather reliable and detailed data and to return the expected benefits (i.e. valuable insights

about the post-acquisition process) to the participant organizations.

Other causes include the bank being acquired or becoming involved in a merger

o f equals (three cases). In four other cases the Phase 1 contact left and there was no clear

substitute who could coordinate the completion o f Phase 2. Another four banks are still

declaring an interest in completing Phase 2, but have not yet delivered on their

commitment.

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Table 5.1 summarizes the results o f T-tests for differences in the means between

the Phase 1 and Phase 2 samples computed on all the key variables. The analysis affords

both a direct and an indirect test. First, it tests for the presence o f biases between the two

steps o f the research process. In addition, it can be interpreted as an indirect test o f the

representativeness o f the entire industry, as banks declining to participate in Phase 2 may

have been less interested in the study and therefore may be sim ilar in profile to non­

respondents. As the table shows, the two samples are not statistically different on any o f

the dimensions.

Table 5.1 - Tests for mean differences among Phase 1 and Phase 2 samples

Variable Phase 1 sample Phase 2 Sample T statistic (equal variance) T statistic (non- equal variance) ROA 1996 -.0098 -.0367 -.324 -.277 ROA change 87-96 .0675 -.0761 -.912 -.735 ROA average 85-96 .0378 -.0034 -.571 -.533

ROA ch. 2 yrs after acq vs. I yr before -.0257 -.0570 -.321 -.294

ROA ch. 3 yrs after acq vs. 1 yr before -.0137 -.0478 -.255 -.225

Resource quality -.0642 -.1785 -.484 -.473

Resource relatedness .5975 .6516 .523 .528

Integration 2.693 2.544 -.853 -.943

Replacement 2.147 2.143 -.016 -.017

Codification 7.000 5.931 -1.122 -1.126

Experience in good banks 8.471 7.222 -.456 -.443

Experience in bad banks 2.882 2.852 -.033 -.031

Experience in-mkt 7.471 6.321 -.492 -.468

Experience out-mkt 3.941 4.071 .077 .083

Size buyer yr-1 ($ in billion) 26.41 13.42 -1.573 -1.431

Size o f acquisition (% o f buyer’s assets) 8.120 8.891 .219 .226