A Comparison of Technical Efficiency of Performance of Different Banks Before and After Merger: A Study of Pakistan Banking Industry

Mergers and acquisitions are the part and parcel of every field, especially in banking industry. This research is focused on the performance of mergers in the last decade. As evident from recent past the banking industry in Pakistan has to cop with many mergers. Mergers are not opted only for the sake of synergy and economic benefits but there are certain other reasons. In Pakistan the other stimulant is the State Bank of Pakistan’s capital requirement, which is being raised with the passage of time. This study has analyzed the performance of 6 mergers (Prime and ABN AMRO, ABN AMRO and Royal Bank of Scotland, RBS and Faysal Bank, Saudi Pak Commercial Bank and Silk Bank, Union Bank and Standard Chartered Bank and Cres and Samba Bank), occurred in the last decade in Pakistan banking industry. Regression analysis is used to analyze the contribution level of different variables in the bank profitability. The results for net assets, net advances, branches and labor productivity were found to be extensive and quite significant. In the second phase the Data Envelopment Analysis of all the banks were done and it is found that all the banks involved in merger have got their performance improved by some extent. The two stage analysis was used for the analysis of the bank performance i.e. first for efficiency and the later for effectiveness of the bank. The first stage results were found to be impressive for most of the banks but in second stage (effectiveness) the results were quite different. A complete comparison of the individual variables has been done in order to pin point the deficiency of individual banks. Main four resulting banks have shown significant improvement in all the independent variables except the Faysal Bank whose labor productivity has shown rapid downward trend. Overall, the mergers and acquisitions, especially in Pakistani environment, are found to be a win-win situation. Key words: Data envelopment analysis (DEA), Mergers and Acquisition (M&A

Empirical Research on the Effects of Firm-Bank Relationship on Firm’s Performance in Pakistan

In this competitive world of business, every commercial organization is in search of better performance with the help reduction in costs and establishing good market relationships. Bank relationships is one of such policies in order to achieve better performance. This paper has discussed a new aspect of these relationships and its impact on client firm’s performance. The research has collected a data of non-financial firms listed in Pakistan Stock Exchange for a period of 2006-2015 and investigated the impact of Islamic Bank relationships in comparison to the Conventional bank relationships with respect to contribution in client firm performance. The results show that performance of client firm is associated with Islamic banking relationship, positively and significantly. ROA, ROE, ROS and Tobin’s Q are used as the proxies for firm performance and a ratio is calculated between numbers of bank relationship of Islamic bank to conventional bank. In the light of our findings, we suggest that the firms in Pakistan may get more benefits by establishing bank relationships with Islamic banks. Keywords: Firm-bank relationship, Islamic bank, bank relationship, firm performance

Bank-firm Relationships vs Financial Expenses of the Client Firm: Evidence from Developing Markets (Pakistan)

Aiming to perform better always, the management and strategy makers of the firm feel pressure of decision making. An aspect of this strategy is to maintain the continuous and low cost of finance for the firm to excel in the industry. Banking relationships, being the main or sometimes the only source of financing, is very important for the firm. This research aims to answer the question about the number of banking relationships and their effect on firm’s financial expenditures. Our research is unique as our data set is from developing markets and most of the previous researches are focused on developed markets like U.S, Japan, and Italy etc. the data for 180 listed firms is paneled for our research from Karachi Stock Exchange. We attempt to regress the financial expenses of clients firms against our main variables (NBR, MBR) using OLS regression analysis with robust errors. Some other most commonly used variables are also used to control the effect. Our results shows significant and positive effect on financial expenses with respect to increase in number of bank relationships. This means a negative impact on the firm’s performance indirectly. Thus, the firms have to reconsider the number of banking relationship it should establish. Keywords: Multi-bank relationship (MBR), Financial Expense, Firm Performance

The Relationship among Directors' Pay, Corporate Governance, and Firm Performance: Evidence from Financial Sector of Pakistan

This research empirically examines the effect of firms' performance and corporate governance attributes on directors' pay. To attain the objective, the data for the period from 2007 to 2014 are retrieved from annual reports of 52 listed financial firms. Return on assets and return on equity are utilized to measure performance. Board size, board independence, board ownership and CEO duality are employed as corporate governance practices. Using the random effect model, the performance has positively related to directors’ pay, but level of significance is sensitive across performance proxies. The board independence has negatively significantly influenced the directors' pay. However, board ownership significantly positively influenced the directors’ pay. Furthermore, board size and CEO duality both have not significantly associated with directors’ pay

CEMENT INDUSTRY PREFERENCES FOR CAPTIVE POWER PLANTS IN PERSPECTIVE OF CURRENT ENERGY CRISES OF PAKISTAN

In the current wake of energy deficiency, senior management of Pakistan Cement Industry is forced to look for non-conventional sources for electricity generation. Comparative study of captive power plant (CPP) options may help the top management in decision making and highlight the industry preferences for installation of new CPPs. This paper presents an Analytical Hierarchy Process (AHP) based multidimensional approach to select the CPP’s for cement industry and to prioritize the factors affecting this selection. The CPP’s shortlisted for this analysis include; Coal Fired CPP (CF-CPP), Refused Derived Fuel CPP (RDF-CPP) and Waste Heat Recovery CPP (WHR-CPP). The AHP routines are modelled in respective software. Data specific models are solved using the data collected from top management of different cement plants in Pakistan. The quantitative data for alternative power plants with respect to each criterion has been collected from different data bases. AHP results show that Pakistan cement industry has a strong demand for non-conventional CPP’s and the top management is giving high priority to factors like ‘Automation’ and ‘Performance’ while installing the CPP’s. Management is not much sensitive about the associated initial costs. The paper concludes with a ranking list in which WHR-CPP is at the top while RDF-CPP and CF-CPP are at the second and third place respectively. The results may help the policy makers of international CPP manufacturing firms and national cement industries in their future strategic decisions

EMA Implementation and Corporate Environmental Firm Performance: A Comparison of Institutional Pressures and Environmental Uncertainty

Environmental management accounting (EMA) practices guide a firm’s response to perceived environmental uncertainty (EU) and various institutional pressures (IP). Drawing upon institutional theory, this study explores the relative effects of institutional pressures and environmental uncertainty on the implementation of EMA, an environmental strategy (ES), and the resulting environmental performance (EP) of firms under the influence of top-management support (TMS) and perceived benefits (PB). Based on data collected from 243 firms operating in Suzhou, one of the busiest business hubs in China, this research used the structural equation modeling (SEM) technique. Findings reveal that environmental uncertainty exerts a stronger influence on the adoption of EMA practices than institutional pressures; however, the choice of a firm’s environmental strategy is more influenced by institutional pressures. Likewise, the serial-mediation effect of environmental strategy and EMA practices is observed to be the strongest in the case of coercive pressures, with some notable moderation effect for perceived benefits and top-management support. The study concludes with theoretical and managerial implications

Estimation of spatial genetic structure in inter-regional populations of Trigonella foenum-graceum L. species through phenotypic variation and seed protein profiling

Fenugreek (Trigonella foenum-graceum L.) is an important legume crop mainly grown for its pharmacological and nutritional value in Mediterranean region, western Asia, Indian sub-continent and Africa. We evaluated 110 fenugreek accessions from diverse agro-ecological regions i.e. South Asia, Mediterranean, Middle East, Europe and Africa for phenotypic divergence and seed protein based variation. Significant agro-morphological variability was revealed by germplasm viz-a`-viz traits e.g days to flower initiation, days to flower completion, yield plant-1, plant habit, vigor, flower colour and plant height. Multivariate approach of Principal Component Analysis and Euclidean distance generated dendrogram distributed all accessions into 6 and 9 distinct groups for morpho-agronomic dissimilarities, respectively. Four principal components (PCs) with Eigen value higher than unity (E>1), represented 65% variability in germplasm. Geographical distribution was evident by scatter plot as germplasm figured in 6 different sub-populations. Iranian accessions were most diverse, showing up in all sub-populations followed by Indian, Turkish, Ethiopian, Pakistani and Egyptian accessions which ranked in 5,4,4,3 and 3 sub-populations, respectively. Electrophoretic pattern of seed protein also exhibited considerable polymorphism in the range of 30~100 kDa. Maximum of 16 bands were produced in Turkish PI171872 and Indian PI175321 genotypes. UPGMA based cluster analysis distributed all accessions in 5 groups where accessions from close geographical proximity settled adjacently

Estimation of spatial genetic structure in inter-regional populations of Trigonella foenum-graceum L. species through phenotypic variation and seed protein profiling

Fenugreek (Trigonella foenum-graceum L.) is an important legume crop mainly grown for its pharmacological and nutritional value in Mediterranean region, western Asia, Indian sub-continent and Africa. We evaluated 110 fenugreek accessions from diverse agro-ecological regions i.e. South Asia, Mediterranean, Middle East, Europe and Africa for phenotypic divergence and seed protein based variation. Significant agro-morphological variability was revealed by germplasm viz-a`-viz traits e.g days to flower initiation, days to flower completion, yield plant-1, plant habit, vigor, flower colour and plant height. Multivariate approach of Principal Component Analysis and Euclidean distance generated dendrogram distributed all accessions into 6 and 9 distinct groups for morpho-agronomic dissimilarities, respectively. Four principal components (PCs) with Eigen value higher than unity (E&gt;1), represented 65% variability in germplasm. Geographical distribution was evident by scatter plot as germplasm figured in 6 different sub-populations. Iranian accessions were most diverse, showing up in all sub-populations followed by Indian, Turkish, Ethiopian, Pakistani and Egyptian accessions which ranked in 5,4,4,3 and 3 sub-populations, respectively. Electrophoretic pattern of seed protein also exhibited considerable polymorphism in the range of 30~100 kDa. Maximum of 16 bands were produced in Turkish PI171872 and Indian PI175321 genotypes. UPGMA based cluster analysis distributed all accessions in 5 groups where accessions from close geographical proximity settled adjacently.</jats:p