Abstract: Kenya's recent economic reforms have tremendously improved its macroeconomic indices and financial sector. As a result of these reforms aimed at privatizing and strengthening the banking sector, banks have seen substantial merger and acquisition taking place. This study purposed to investigate the theoretical perspective of mergers and acquisitions and its effect on financial stability of Commercial Banks in Kenya. Monopoly -Market Power Theory, Value-Increasing Theories, Hubris Hypothesis and Corporate control theory informed the study. These theories added to our understanding of how mergers and acquisitions influence financial stability. Mergers and acquisition, according to the study, have a positive effect on financial stability of commercial Banks. Therefore bank stability is strongly reliant on the success of mergers and acquisitions.
Keywords: Mergers and Acquisition, Financial Stability, Monopoly -Market Power Theory, Value-Increasing Theories, Hubris Hypothesis and Corporate control theory.
Title: MERGERS AND ACQUISITIONS ON FINANCIAL STABILITY OF COMMERCIAL BANKS IN KENYA: A THEORETICAL PERSPECTIVE
Author: Odhiambo Frank Amolo, Dr. Ambrose Jagongo
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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