Professional Documents
Culture Documents
BY
POOJA DHAMI
Exam Roll No: 15389/15
T.U. Reg. No: 7-2-0364-0034-2015
at the
K&K International College
Tribhuvan University
1
DECLARATION
This is to certify that I have completed the Summer Project entitled “ Impact of
Merger on Employee Satisfaction and Performance of NIC ASIA Bank Limited”
under the guidance of Sindhu Madhav Dhakal in partial fulfillment of the
requirement for the degree of Bachelor of Business Administration at Faculty of
Management, Tribhuvan University. This is my original work and I have not
submitted it earlier elsewhere.
2
ACKNOWLEDGEMENTS
Firstly and foremost, I thank the god almighty for bringing me to this point in my
studies. Secondly, I offer my sincerest gratitude to my supervisor as well as BBA
director, Sindhu Madhav Dhakal for his patience and knowledge whilst allowing me
the room for research work in my own way.
I am grateful to my parents for providing me education and also for their continuous
support right from beginning of my project to the submission of this report.
Pooja Dhami
3
TABLE OF CONTENT
Title page
DECLARATION ......................................................................................................................... 2
ACKNOWLEDGEMENTS ......................................................................................................... 3
TABLE OF CONTENT ............................................................................................................... 4
LIST OF TABLES....................................................................................................................... 6
LIST OF FIGURES .................................................................................................................... 7
EXECUTIVE SUMMARY........................................................................................................... 8
CHAPTER I................................................................................................................................ 9
INTRODUCTION ...................................................................................................................... 9
1.1 Context Information ......................................................................................................... 9
1.2 Purpose of the Study ...................................................................................................... 10
1.3 Significance of the Study ............................................................................................... 11
1.4 Literature Survey ........................................................................................................... 11
1.4.1 Review of major Articles on job satisfaction and bank performance ..................... 11
1.4.2 Review of major Articles on merger and bank performance .................................. 13
1.5 Research Methods .......................................................................................................... 16
1.5.1 Data analysis tool .................................................................................................... 16
CHAPTER II ............................................................................................................................ 17
DATA PRESENTATION AND ANALYSIS ............................................................................... 17
2.1Respondents’ Profile ....................................................................................................... 17
2.1.1 Gender of the Respondents ..................................................................................... 17
2.1.2 Age of Respondents ................................................................................................ 18
2.2 Data Presentation and Analysis ..................................................................................... 19
2.2.1 Major Influenced areas after merging ..................................................................... 19
2.2.2 Impact of merger on investors ................................................................................ 21
2.2.3 Impact on working environment after merging ...................................................... 22
2.2.4 Impact of merger on productivity ........................................................................... 24
2.2.5 Impact on profitability of the bank ......................................................................... 25
2.2.6 NIC Asia Bank is more successful after merger ..................................................... 26
2.2.7 The services provided by the bank improved after merger ..................................... 27
4
2.2.8 Increases the number of customers after merger..................................................... 29
2.2.9 Merger brings back employee’s confidence on Bank ............................................. 30
2.2.10 Employees career growth and development within the Bank after merger .......... 32
2.2.11 Impact of merger on employees satisfaction ......................................................... 33
2.2.12 Financial highlights of NIC Asia before and after merger .................................... 34
2.3 Findings and Discussion ................................................................................................ 38
CHAPTER III ........................................................................................................................... 41
CONCLUSION AND ACTION IMPLICATIONS ..................................................................... 41
3.1 Conclusion ..................................................................................................................... 41
3.2 Action Implications ........................................................................................................ 42
REFERENCES ......................................................................................................................... 43
APPENDIX .............................................................................................................................. 45
5
LIST OF TABLES
Table1. 2 Studies associated with job satisfaction and bank performance .................. 12
Table1. 3 Studies associated with merger and bank performance after 2010 .............. 15
6
LIST OF FIGURES
7
EXECUTIVE SUMMARY
The aim of this research is to analyse impact of merger in NIC Asia Bank Limited in
terms of profitability, earning per share, and return on shareholder’s equity,
customer’s satisfaction, and employee’s level of satisfactions, employee’s
performances, overall bank’s performance, capital structure, bank’s brand value and
market position. There are several merger banks and financial company who merge in
different period of time. Since there are so many merger banks, the most important
thing for banks is to understand customer needs, employees level of satisfaction and
shareholder’s profit.
The result of this study would contribute as a guideline for the researchers to provide
concrete paths for conducting future researches. This study helps the reader to
analysis the impact of merger in NIC Asia Bank Limited. The study also assists the
concerned authorities of NIC Asia Bank to have idea on merger.
8
CHAPTER I
INTRODUCTION
NIC ASIA Bank was renamed after the merger of NIC Bank and Bank of Asia Nepal
on 30th June 2013. Bank of Asia Nepal was a relatively younger bank established in
year 2007 and NIC Bank was established in year 1998.The Bank has 196 branches
and 5 extension and 198 ATMs across Nepal with a network covering all major
financial centres of the country. This was the historic merger in the annals of
Nepalese financial landscape as the first of its kind merger between two successful
commercial banks in the country.
The directors of the bank are great personalities with vast experience in business and
the financial sector. The board of director is fully committed to high standard of
corporate governance, which among encompasses the principles of transparency,
social responsibility. Mr. Tulsi Ram Agrawal is a chairman of NIC ASIA Bank. Mr.
Jagadish Prasad Agrawal, Mr. Ram Chandra Sanghai, Mr.RajendraAryal,
9
Mr.TrilokChandAgrawal, Mr.BinodKumarPyakurel and Mr. Ganesh Man Shrestha
are the directors of NIC ASIA Bank Ltd. Area served by this bank is around Nepal.
“Bank PaniSathiPani” is a slogan of NIC Asia Bank. It is largest private sector
commercial bank in terms of capital base, balance sheet size, number of branches,
ATM network and customer base.(https://www.nicasiabank.com/about-us/board-of-
directors)
As a responsible corporate citizen of the country, the Bank has been involved in
contributing to the society in various ways as a part of its Corporate Social
Responsibility (CSR). In order to promote and focus on CSR activities the Bank has
established a charitable foundation called NIC ASIA Foundation. The Bank has
committed to pledge 1% of its net profit every year to the NIC ASIA Foundation for
promoting various CSR related activities.
In the past, the NIC ASIA Foundation has carried out various activities including, but
not limited to, distributing disaster relief packages to the victims of various disasters,
contributing to the Prime Minister Relief Fund, organizing health camps, organizing
blood donation camps, providing support to old age homes and orphanages, providing
scholarships to the needy students, etc. A significant number of people have been
benefitted, directly or indirectly, by the activities carried out by the Foundation. The
Foundation plans to continue the same in the future as
well.(https://www.nicasiabank.com/about-us/csr)
This study attempts to analyse the satisfaction level of employees and the
performance in NIC ASIA Bank Ltd. And also evaluate the perception of employees
towards merger.
10
1.3 Significance of the Study
The importance of the study means the value of the research and research design to
the related organization and person. All the studies are done to have some meaningful
outcomes and those outcomes help the readers. The significance of the study are
described below:
The study will play an important role in decision making of the organization.
The major research findings of this study can be used to identify the
competitive advantage of NIC ASIA Bank Ltd.
The reference can get knowledge about how to do the project work, what
methods and techniques of data collection, presentation and analysis.
Dizgah et al. (2012) investigate the relationship between the job satisfaction and job
performance in Guilan public sector. Sample size was 323 and was selected by
available non-probable samples. Data were collected by questionnaires and
Cronbach’s alpha coefficient was used. Results showed that there is a meaningful
relationship between job satisfaction In-role performance and innovative job
performance and findings are in accordance with previous researches. Similar study of
Hasanzadeh and Gooshki(2013) concluded that here is a significant relationship
between involvement management, job satisfaction and job performance. The study
11
also found that job satisfaction partially mediates the relationship between
involvement management and job performance.
To examine the level of job satisfaction among the employees in the eastern Libiya,
Bader et al. (2013) took sample of 536 employee of the major bank from four cities of
Libiya and used the Minnesota Satisfaction Questionnaire (MSQ) to assess
employees’ job satisfaction. The findings of the study revealed that bank employees
in eastern Libya reported a high level of job satisfaction in all aspects of their job.
While the factors of gender, age and type of occupation have no significant effects on
the level of job satisfaction, marital status, education level, city and the duration of
work have shown significant effects on the level of job satisfaction.
Ahmed and Unddin The major areas of dissatisfaction are salary, promotion
(2012) and benefits. There should be provision for different kind
of rewards for better performance. It will encourage them
to take responsibility and also will improve their
willingness to perform better.
Dizgah et al. (2012) The major areas of dissatisfaction are salary, promotion
and benefits. Employees in early stages of careers are more
satisfied then older employees and they performed also
better than those employees. There is a positive
relationship between job satisfaction and job performance.
Bader et al. (2013) Gender, age and type of occupation have no significant
effects on the level of job satisfaction, marital status,
education level, city and the duration of work have shown
significant effects on the level of job satisfaction.
12
1.4.2 Review of major Articles on merger and bank performance
The existing analyses of the effects of bank consolidation could be broadly divided
into two types, namely, static analyses and dynamic analyses (Berger, Demsetz, and
Strahan 1999). The former are usually conducted prior to consolidation events such as
mergers and acquisitions (M&As) and aim at detecting potential consequences on
performance prior to M&As. The dynamic analyses, on the other hand, study the ex-
post effect of M&As by comparing the performance of the participating institution
before and after the event or by comparing it with other non-participating institutions.
Owolabi and Ajayi (2013) used gross earnings, profit after tax and net asset of the
selected bank as indices to determine financial efficiency by comparing the pre-
mergers and acquisitions indices for the period under review for the paper, three
Nigeria banks were selected using convenience and judgment sample selection
methods. Data were collected from the published annual reports and account of the
selected banks and were subsequently analysed applying t-test statistics through
statistical package for social science. It was found that the post-mergers and
acquisitions period was more financially efficient, the study recommend that the
banks should be more aggressive in their profit drive for improved financial position
to reap the benefits of post mergers and acquisitions.
To analyse the impact of merger, Naga Sai and Sultana (2013) applied the t-test to
various financial ratios for before and after merger data. Based on the analysis of
Indian overseas bank data, the study concluded that Net profit margin, Operating
profit margin, Return on capital employed, Return on equity and Debt-Equity ratio
there is significant difference but no significant difference with respect to Gross profit
margin.
Aiming to analyse the effects of banks mergers and their announcements on the prices
of stocks, in Europe Dilshad (2013) studied 18 deals that involve banks in Merger and
Acquisition from year 2001 to 2010 in order to investigate the returns of shareholder
of the targets and acquirers. Evidence supported that significant cumulative abnormal
returns were short lived for the acquirers. At the end of the event window, the
cumulative abnormal returns were 0. Evidence of excess returns after the merger
13
announcement was also observed along with the leakage of information that resulted
in the rise of stock prices few days before the announcement of merger or acquisition.
At the same time, the results of cumulative abnormal returns showed that target banks
earned abnormal returns on the merger announcement day.
Different researchers have used the Data Envelopment Analysis (DEA) approach to
analyse the efficiency of the bank in the post-merger period. Said (2013) analysed the
Tunisian bank mergers and acquisitions performance by employing a set of financial
and accounting ratio analysis and DEA approach. The empirical findings from
financial ratio analysis provided evidence that the mergers have not resulted in
generating profits from assets or in return to shareholders post-merger. The findings
from the DEA approach suggested that, although an improvement in the overall
efficiency scores by 30.77%, Tunisian banks remained, on average, totally inefficient.
Our results indicated also that, as a source of improvement, the allocated component
(24.76%) was more important than the technical component (5.32%). Thus, as a result
of these transactions, Tunisian banks became more able to combine the inputs and
outputs in optimal proportions, taking into account the prices, than to avoid the waste
in using inputs.
Though merger and acquisition has led to the efficiency and improvement in
performance some studies found negative effect of the merger. Kayani et al. (2013)
investigated the impact of Merger and Acquisitions on operating performance and
shareholder wealth in Pakistani banking sector. Paper studied the impact on acquiring
firms before and after the transaction. The study selected 3 transactions of merger and
acquisitions in Pakistani banking sector from 2007 to 2010 with both domestic and
foreign banks which are operating in Pakistan. Study used event study methodology
to determine the post-merger impact on operating performance and shareholders
wealth of the bidder firms.
14
Table1. 2 Studies associated with merger and bank performance after 2010
Owolabi and Ajayi The post-merger and acquisition period are more
(2013) efficient.
Naga Sai and Sultana Net profit margin, Operating profit margin, Return on
(2013) capital employed, Return on equity and Debt- Equity
ratio there is significant difference but no significant
difference with respect to Gross profit margin.
From the analysis of data with literature survey, it is found that merger was only
concerned with performance aspect of bank. Human aspects in the pre and post-
merger were not taken into account. The satisfaction of human aspects was fully
neglected in merger process. As human resource play a vital role in performance of
bank, this study contributes taking human aspect as the major factor and their positive
involvement in the performance of bank.
15
1.5 Research Methods
Research methodology is a way to systematically solve the research problem. It refers
to the various sequential steps that are to be adopted by a researcher during the course
of studying the problem with certain objectives.
The study is based on primary and secondary sources of data. The primary sources of
data have been used to assess the opinion of respondents with respect to job
satisfaction and bank performance. Secondary data has been used to compare the
performance of bank before and after merger.65 questionnaires were distributed to
respondents only 50 filled up by the respondents with response rate 76.9%. This
report is based on convenience sampling technique. The analysis of study is done
within the Kathmandu valley. Questionnaires were distributed to employees of head
office of NIC ASIA Bank located at Thapathali, New Baneeshwor, Dillibazar and
Sinamangal.
All the data which are received from the various sources has been manipulated
properly, composed together to give a good outcome. They are presented in:
Pie chart
Bar diagram
Line chart
Percent
16
CHAPTER II
2.1Respondents’ Profile
Different respondent were selected and questionnaire were asked. Following analysis
is done. According to questionnaire filled.
Male 22 44
Female 28 56
Total 50 100
17
Figure2. 1Gender of Respondents
30 28
25
22
No. of respondent
20
15
10
0
Male Female
Gender
Figure 2.1.1 reveal that out of the total respondent selected as sample for the survey,
44% are male and 56% are female.
20-25 36 72
26-30 10 20
31-35 3 6
36-40 1 2
Total 50 100
18
40
35
30
No. of respondedt
25
20
15
10
0
20-25 26-30 31-35 36-40
Age
Figure 2.1.2 reveals that out of the total respondent selected sample for the survey,
72percent are age group between 20-25, 20percent are age group between 26-30, 6
percent age group between 31-35 and 2 percentages are age group between 36-40.
19
Table 2.3 Major area influenced after merging
2. Employee 4 8 IV
performance
3. Investors attitude 1 2 V
4. Market position 10 20 II
5. Overall bank’s 30 60 I
performance
Total 50 100
20
Figure2. 3 Major area influenced after the bank merger process
10%
customer relation
8%
2%
Employee performance
Investors attitude
1. Strongly Positive 16 32 II
2. Positive 21 42 I
3. Neutral 11 22 III
4. Negative 2 4 IV
5 Strongly negative - - -
Total 50 100
21
This result can also be presented in terms of pie-chart;
0%
4%
22% 32%
Strongly positive
positive
neutral
negative
Strongly negative
42%
22
Table2. 5 Impact on working environment after merging
2. Satisfied 18 36 I
3. Neutral 17 34 II
4. Dissatisfied 4 8 IV
5. Highly 2 4 V
Dissatisfied
Total 50 100
4%
8% 18%
Highy satisfied
Satisfied
Neutral
34% Dissatisfied
Highy dissatisfied
36%
23
2.2.4 Impact of merger on productivity
The study seeks to determine the impact of merger on productivity of NIC Asia bank
ltd. After the merger the trend of almost banks shows that, improved on productivity
like increase on number of branches, ATM facilities, loan facility at low interest rate
etc. To identify the nature of impact on NIC Asia Bank, questionnaire was distributed
to the 21 number of employees of this bank. The responses are presented in the
following table.
2. Agree 26 52% I
3. Neutral 4 8% III
4. Disagree 1 2% V
5. Highly disagree 2 4% IV
Total 50 100
24
Figure2. 6The merger impact on the productivity of the bank
2%
4%
8%
2. Agree 26 52% I
3. Neutral 2 4% III
4. Disagree 1 2% IV
5. Highly disagree 1 2% IV
Total 50 100
25
This result can also be presented in terms of pie-chart;
2% 2%
4%
Highly agree
40%
Agree
Neutral
Disagree
1. Strongly agree 17 34 II
2. Agree 27 54 I
3. Neutral 4 8 III
4. Disagree 1 2 IV
5. Strongly disagree 1 2 IV
Total 50 100
26
The above table shows that 57% employee in 1st rank agrees that NIC Asia bank is
more successful after merging as it has earn more profit and earn the reputation in the
market.. 43% respondents in 2st rank strongly agree, and no one is disagreeing with
the success of the bank after merger.
This result can also be presented in terms of pie-chart;
2% 2%
8%
54%
27
Table2. 9 Services provided by bank improved after merger
1. Strongly agree 14 28 II
2. Agree 22 44 I
3. Neutral 10 20 III
4. Disagree 3 6 IV
5. Strongly disagree 1 2 V
Total 50 100
28
Figure2. 9 The service provided by the bank improved after merger
2%
6%
44%
1. Strongly agree 25 50 I
2. Agree 18 36 II
3. Neutral 6 12 III
4. Disagree - - -
5. Strongly 1 2 IV
disagree
Total 50 100
29
which is in 2nd rank and in 3rd rank 12% are neutral. Only 2% employees are highly
disagreeing on the statement of increasing number of customer after merger.
This result can also be presented in terms of pie-chart;
0% 2%
12%
Strongly agree
Agree
50%
Neutral
Disagree
36%
Strongly disagree
30
Table2. 11 Employee’s confidence on Bank
2. Agree 17 34 I
3. Neutral 16 32 II
4. Disagree 3 6 IV
5. Strongly disagree 1 2 V
Total 50 100
2%
6%
26%
Strongly agree
Agree
32% Neutral
Disagree
Strongly disagree
34%
31
2.2.10 Employees career growth and development within the Bank after merger
If employees are getting bored and restless, it might have less to do with promotion
opportunities, and more about their development. To find out the individual career
growth and development within the bank after merger, survey was conducted in NIC
Asia bank ltd. 50 employees of different levels were distributed questionnaire and the
collected data is presented below.
1. Strongly agree 11 22 II
2. Agree 25 50 I
3. Neutral 7 14 III
4. Disagree 6 12 IV
5. Strongly disagree 1 2 V
Total 50 100
32
Figure2. 12Employees career growth and development
2%
12%
22%
Strongly agree
14% Agree
Neutral
Disagree
Strongly disagree
50%
2. Satisfied 27 54 I
3. Neutral 13 26 II
4. Dissatisfied - - -
5. Strongly dissatisfied 1 2 IV
Total 50 100
33
rank and in 3rd rank 18% are strongly satisfied. Only 2% employees are strongly
disagreeing with the statement of employee satisfaction.
This result can also be presented in terms of pie-chart;
0% 2%
18%
26%
Strongly satisfied
Satisfied
Neutral
Dissatified
Strongly dissatisfied
54%
34
Table2. 14 Financial indicator before after merger
Net Profit
Net Profit/Loss is the total earnings or deficit of the concern company. It is calculated
by subtracting all the expenses with its total revenue published by the company as an
income statement. It measures the financial performance of the company. Through the
analysis of above data, there is rapidly increase in net profit after merger up to
FY2014/15 and decrease in FY 2015/16 and again increase in FY 2016/17 and it
continue to increase again in 2017/18. The above data are also presented in following
figure.
35
Figure2. 14NPAT of NIC Asia Bank Limited
1,800,000,000.00
1,600,000,000.00
1,400,000,000.00
1,200,000,000.00
NPAT
1,000,000,000.00
800,000,000.00
600,000,000.00
400,000,000.00
200,000,000.00
-
Fiscal year
Through the analysis of data there is rapidly increase of profit after merger. It shows
significant relation between merger and profitability in NIC ASIA Bank Limited.
When increases the profit it helps to strengthens the bank and makes more success.
Profit in 2012/13 is less than 2011/12, profit in 2013/14 is more than 2012/13, profit
in 2014/15 is more than 2013/14, profit in 2015/2016 is less than previous year but in
year 2016/17 it has high profit than 2015/2016 and in year 2017/18 it has highest net
profit after tax that is Rs 1,634,460,000.
36
Figure2. 15Earning per share of NIC Asia bank
50
45
40
35
30
25
20
15
10
5
0
2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18
The figure EPS of NIC ASIA Bank Limited has been rapidly decreasing from fiscal
year 2011/12 to 2012/13 that is from 37.80% to 30.06%, and then increases in fiscal
year 2013/14, and rapidly decreases in fiscal year 2014/15, 2015/16 and 2016/17. And
now it is slightly increasing in year 2017/18.
Return on Equity
ROE measures the rate of profit generated by utilizing the shareholder’s funds. Return
on equity measures the impact on shareholders and find out the condition of
shareholders. It is calculated by dividing the profit after tax by average shareholder’s
equity. The ratio show how effectively the shareholder’s investment has been utilized
by the firm.
37
Figure2. 16 ROE of NIC ASIA Bank Limited
30
25
20
ROE
15
10
0
2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18
Fiscal year
There has been fluctuation in ROE of NIC ASIA Bank 2016. From fiscal year
2011/12 to 2013/14 it has decreases then slightly increases in fiscal year 2014/15 and
then decreases in year 2015/16 and again increase in fiscal year 2016/17and
2017/2018.
38
Majority of the respondents (60 percent) answered that overall bank
performance is influenced after merger. However, (20 percent) of respondents
answered that market position is influenced after merger, (10 percent) thinks
customer relation is affected.8% thinks that employee performance is affected
and 2% think that investors’ attitude is affected.
Majority of the respondents (42percent) finds the impact of merger positive,
(32 percent) finds strongly positive, (22percent) finds neutral and 4 percent
finds negative.
Among the 50 number of respondent, majority of employees (36 percent) are
satisfied with working environment, (18 percent) highly satisfied on working
environment of NIC Asia bank ltd after merging. (34 percent) neutral, (8
percent) dissatisfied and (4 percent) highly dissatisfied, it means merger has
not perfectly positive impact in this bank.
Among 50 respondents, majority of respondents (52 percent) agree that the
productivity of bank increases after merger. 34% employees are highly agree,
8percent are neutral. 2 percent are disagree with the statement and 4% is
highly disagree
Majority of the respondents (52 percent) agree on profitability of bank after
merger, (34 percent) highly agree. (8 percent) neutral, (4 percent) highly
disagree and (2 percent) disagree.
Majority of respondents (54percent) agree with the statement that NIC ASIA
Bank is more successful after merger, (34 percent) of the respondents strongly
agree on it whereas 8 percent of the respondents are neutral. (2 percent)
disagree and (2 percent) highly disagree with the statement.
Majority of the respondents (44 percent) agrees that services provided by bank
has been improved after merger, (28 percent) strongly agree,(20 percent) of
the respondents are neutral on it whereas (6 percent) of the respondents
disagree. (2 percent ) strongly disagree.
Out of 50 respondents, (50 percent) strongly agree with the statement that the
number of customers increases after merger. (36 percent) highly agree and in (
12 percent) neutral whereas (2 percent) highly disagree with the statement.
out of 50 respondents (34 percent) agree with the statement that merger brings
back employees’ confidence on bank, (32 percent) neutral, (26 percent)
39
strongly agree, (6 percent) disagree and (2 percent) strongly disagree with the
statement.
Majority of respondents (50 percent) agree with the statement that there is
employee career growth and development within the company after merger.
(22 percent) highly agree, (14percent) neutral, (12 percent) disagree and (2
percent) highly disagree with the statement of employee career growth and
development.
Majority of respondents (54percent) satisfied with the statement. (26 percent)
neutral, (18percent) strongly satisfied. (2 percent) strongly disagree with the
statement of employee satisfaction
Banking performance in post-merger period is better than pre-merger period
A similar study conducted by Ahmed and Unddin, (2012) and Dizgah et al., (2012)
found thatthe major areas of dissatisfaction of employees are salary, promotion and
benefits and he conclude that there is positive relationship between employee
satisfaction and performance. This research also found that satisfied working
environment, individual career growth and development within the bank can increase
the satisfaction level of employees and performance of bank. Owolabi and Ajayi,
(2013) found that post-merger and acquisition period are more efficient. This research
also found that after merger productivity and profitability increases. The study
conducted by said,(2013) concludes that mergers have not resulted in generating
profits from assets or in return to shareholders. Banks lost from their ability to
generate revenue from their expenditures. But in this research only performance
comparison is done between before and after merger. The study conducted by Kayani
et al., (2013) concludes that there is a negative effect of merger and acquisition on the
earning per share or shareholder wealth. And this study also concludes there is
negative relation effect of merger on the earning per share.
40
CHAPTER III
3.1 Conclusion
The major conclusion of this study is employees of the bank are not fully satisfied.
Employees also perceive risk in their job. When two or more bank merges, bank
becomes more strong and competitive. Maximum numbers of employees are satisfied
with working condition and services provided by bank. According to the perception of
employees overall banks performance in influenced after merger, impact of merger on
investor is more positive, productivity and profitability of bank increases after merger.
Employees also believe that merger can solve current financial problems of liquidity,
less confidence, and many other problems.
This study also concludes that the success of merger depends upon the satisfaction of
employees. Merger can succeed by attracting more customers for quality and better
services. When banks merge, employees expects that their salary and benefits would
increases more growth opportunities as well as training and development
opportunities would arise. Employees believe that merger can help improvement in
working condition, services provided by bank, training and development that help to
maintain better relation with co-workers and supervisors, so that employees’
performance would be better.
The secondary data collected by bank showed that Net profit after tax of bank can be
increased after merger. Merger helps in great deal to increases the bank performance.
ROE and EPS are also increased after the merger of NIC ASIA Bank. This shows that
merger in one way or other helps to improve the performance of bank.
41
3.2 Action Implications
This part of the report includes the action implications of this study along with the
same valuable suggestions that might come helpful for any other similar research
conducted in the future. These implication and recommendations are solely based on
the conclusions drawn on above section.
Government should provide enabling environment that will encourage more merger in
Nepal, where our nation can have a strong bank with good capital bases
As the result revealed that employees are less satisfied with performance appraisal
and training and development opportunities, bankers should make more effective
performance appraisal system and provide deserving salary which can increase
satisfaction level in employees and help increase in bank performance.
As the result has revealed that workload for employees increases after bank go into
merger, which is causing dissatisfaction in among employees, the managers of merger
banks should make flexible and relax rules in working hours, procedures and
methods.
After the merger of bank there may occurs lack of communication and that creates
distrust and uncertainties in the work place, leading to lower employee engagement
levels so, employee participation is important.
42
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industry: causes, consequences and implications for the future.Journal of Banking &
Finance. 23(2), 135-194.
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Websites
https://www.nicasiabank.com/
https://www.coursehero.com/file/13954911/13-Impact-and-Challenges-of-Merger-and-
Acquisition-in-Nepalese-Banking-and-Financial-Institutionsd/
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APPENDIX
Questionnaires:
Dear prospective participation,
I am Pooja Dhami, student of K & K International College. The following questionnaire is
designed to analyze the impact of merger on employee satisfaction and performance of NIC
Asia Bank. The information gathered here will constitute a source for a summer project report
for TU BBA 7th semester. Therefore, you are asked to fill out the following questionnaire as
precisely and accurately as you can. The result will be used for a general assessment and your
answers will be used only for this study confidentially.
NOTE :- Your personal information will not be disclosed.
Thank you very much for your participation
Please tick (√) appropriate answer
2. Age of respondent
a) 20-25 b) 26-30 c) 31-35 d) 36-40
o Customer relations
o Employee performance
o Investor’s attitude
o Market position
o Overall banks performance
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2. What do you find the impact of merger on investor?
o Strongly Positive
o Positive
o Neutral
o Negative
o Strongly negative
3. Working environment of the bank after merger is
o Highly satisfied
o Satisfied
o Neutral
o Dissatisfied
o Highly Dissatisfied
4. The merger impact on the productivity of the bank.
o Strongly agree
o Agree
o Neutral
o Disagree
o Highly disagree
5. The merger impact on the profitability of the bank.
o Highly agree
o Agree
o Neutral
o Disagree
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o Highly Disagree
6. NIC Asia Bank is more successful after Merger.
o Strongly Agree
o Agree
o Neutral
o Disagree
o Strongly disagree
7. The services provided by the bank improve after merger.
o Strongly agree
o Agree
o Neutral
o Disagree
o Strongly disagree
8. Increases the number of customers after merger.
o Strongly agree
o Agree
o Neutral
o Disagree
o Strongly disagree
9. Merger brings back employee’s confidence on bank.
o Strongly agree
o Agree
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o Neutral
o Disagree
o Strongly disagree
10. Do you believe that there is an opportunity for individual career growth and
development within the bank after merger?
o Strongly agree
o Agree
o Neutral
o Disagree
o Strongly disagree
11. How satisfied are you working with the company after merger?
o Strongly satisfied
o Satisfied
o Neutral
o Dissatisfied
o Strongly dissatisfied
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