Mergers & Acquisitions

Mergers & Acquisitions

Mergers and acquisitions are a key element and by-product of credit markets and economics. Companies have a variety of motives for conducting mergers and acquisitions – some good, some questionable. Growth, competition and survival have long been the three major incentives for companies to merge. In 2007, a consortium led by Royal Bank of Scotland (RBS) acquired the Dutch bank ABN AMRO for $101 billion.  In October 2008, as credit markets tightened, RBS received $35 billion in bailout money from the British government. In February 2009, the former Chairman of RBS had this to say: "We are sorry we bought ABN Amro. The deal was a bad mistake."  The British government now owns 70% of RBS.  In this section, CreditPulse provides coverage, analysis and perspective of mergers and acquisitions.

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The nation's largest commercial banks have been at the epicenter of the credit crisis. Last month, the most troubled of these banks, New York-based Citigroup, announced it was splitting apart basically undoing the mammoth merger of a decade ago.  Reed: "Merger was a mistake."

On April 6, 1998, New York-based Citicorp and Travelers Group announced they were merging in an $82.9 billion deal which at the time was the largest in U.S. history. The new financial behemoth which brazenly combined banking with brokerage and investment services and insurance with assets