| Summary: | This study analyzes the responses of performances of Bank
Mandiri, Bank Danamon, and Bank Permata to merger strategy.
This paper harnesses the quantitative approach with structural
break analysis method and impulse response function. The
plausible findings indicate that the merger of Bank Permata
produces a better performance response in comparison to the
consolidation of Bank Mandiri and the merger of Bank Danamon.
The merger of Bank Permata does not result in performance
shocks, and the structural break does not prevail either. On the
other hand, the consolidation of Bank Mandiri and the merger
of Bank Danamon result in structural breaks, particularly in the
spread performance. In order to return to the stable position, the
mergers of Bank Mandiri and Bank Danamon require a longer
time than does the merger of Bank Permata. This research
indicates that for large banks, the mergers and acquisitions
(retaining one existing bank) will deliver a better performance
response than will the consolidations (no existing bank).
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