A special focus is given on the measures taken by the central bank to combat pressures of recession. International Monetary Fund (IMF) states that a global recession would take a slowdown in global growth to three percent or less. By this measure, four periods since 1985 qualify: 1990–1993, 1998, 2001–2002 and 2008–2009. The study concludes by answering the big question- “How globalization has affected the overall banking industry’s performance and whether the interdependence of economies has helped at times of a recessionary period?” (Busch, A.) (2009).
Hence, it becomes imperative to find measure the performance of banks operating in both developed nations like USA and developing nations like India in terms of productivity and efficiency. Both macroeconomic and microeconomic factors are included in the findings. This would help in determining the flaws in the banking sector which assisted the recession to explode
This study helps in finding out how mergers and acquisitions help in reshaping the market structure of the Global banking sector. As per Singh’s (2005) review , “ The Global banking industry has gone rapid consolidation and restructuring since the 1990s. M&As , privatization of state owned banks, removal of restrictions on the entry of foreign banks and deregulation of banking industry are part of this process”. Hence, the big question is answered as to whether M&A’s resulted in reducing the competition and restructuring the market towards oligopoly and has this been good for the country’s economy?
The market share of each of the major banks is considered and the data for the same is sourced. In order to measure the performance of banks in both developing and developed economies, ratio analysis is carried out with return on assets (ROA) being the major indicator. A sample of 20 Global banks is taken and the weighted average performance of all 20 is