Choice approach to the valuation of the financial institution in М&A contracts using the analytic hierarchy process
Keywords:
financial institution, М&A contracts, analytic hierarchy process, mergers and acquisitionsAbstract
Purpose and subject of research
The purpose of research is rationale for the choice approach to valuation of financial institutions, the most appropriate in mergers and acquisitions. The object of study is the choice of approach to valuation of financial institutions in mergers and acquisitions.
Research methodology
The study used the methods of valuation of financial institutions that are legislated inUkraine, namely: cost, comparative and revenue.
Value results
The relevance of the topic chosen is usually in the works of scholars choice approach to valuation is based on logical reasoning without the use of specialized tools for decision making. According to the National Standard number 1 "General Principles of valuation of property and property rights" inUkrainelegislated mandatory application of the income, expenditure and comparative approaches to assessing the value of any object. Therefore, the question of choice reasoned approach to the valuation of financial institutions in mergers and acquisitions are opened.
Conclusions
The results of the study concluded that, if necessary, to take account of mergers and acquisitions investment value of the financial institution objectives as an integrated facility and its development potential is the most appropriate evaluation procedures focus on methods of income approach.
Although he has a number of shortcomings of traditional methods of valuation, however, is the most appropriate contractual M & A, takes into account the valuation of financial institutions in mergers and acquisitions and can be the basis for further research in the area of valuation of financial institutions in mergers and acquisitions.
Key words: financial institution, М&A contracts, analytic hierarchy process, mergers and acquisitions.References
Vitlinskiy, V. (ed.) et al. (2002) Economic risk: game models. Kiev: Kyiv National Economic University.
UKRAINE. CABINET OF MINISTERS (2003) National standard number 1 «General principles of property valuation and property rights», 1440th Resolution, 10th September 2003. Official bulletin of Ukraine, 37, pp. 64.
Rothstein, A (1999) Intelligent identification technology: fuzzy logic, genetic algorithms, neural networks. Vinnitsa: UNIVERSUM-Vinnitsa.
Saaty, T. (1993) Decision-making. The method of analysis of hierarchies. Moscow: Radio and Communications.
Yaremenko, N. (2012) Valuation of the bank: essence and definitions. Investment: Practice and Experience, 21, pp. 73–75.
Yaremenko, N. (2011) The main features of the bank valuation of M&A. Business Inform, 3, pp. 114–117.
Yaremenko, N. (2010) Bank valuation in Ukraine: basic approaches and their possible use. The Collection of scientific proceedings «Financial and credit activity: problems and prospect», 1 (8), pp. 24-29.
Downloads
Issue
Section
License
All rights reserved for authors with articles of printed version of ISJ "Economic Cybernetics" (ISSN 2077-8031).
Copyrights of published works are retained by the author(s) but with first publication rights granted to Donetsk National University. Further, in case of any plagiarism issue author(s) hold(s) complete liability.
Online version of ISJ "Economic Cybernetics" (ISSN 2312-5837) is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Permissions beyond the scope of this license may be available at http://ec.projects-manager.com.
