Importance Macroeconomic risks and toughened prudential requirements on commercial banks significantly reduce the number of the latter. The paper discusses mergers and acquisitions in the Russian and foreign companies and their impact on the financial performance of institutions. Objectives The paper aims to identify features of domestic and foreign mergers and acquisitions in the banking sector; analyze transactions over a number of years identifying motives; determine the degree of financial stability of a large private banking group, actively participating on the banking market of mergers and acquisitions in order to justify these deals. Methods For the research, I used a dynamic analysis as well as the dialectical method of analysis. Results I systematized the views of scholars on mergers and acquisitions in the banking sector and various deals in historical sequence, given their importance for the domestic banking sector. I identify the main causes and trends of consolidation of the banking sector in Russia. Conclusions I draw a comparative conclusion about similar processes in the market of mergers and acquisitions in Western Europe and North America. Mergers and acquisitions as a way of expansion, mainly affect regional banks. The analysis of mergers and acquisitions for a number of years and known motives for such operations show that the achievement of financial stability in the banking sector by consolidating and rapid tightening of prudential requirements is not always warranted. When examining the relationship between mergers and acquisitions transactions and financial stability of a large private banking group, I found that the financial stability of the group after the above-mentioned transactions trends to go down.
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