Buying banks involved in mergers usually experience increases in the price of their stock, though the increase seldom exceeds 5 percent.

Question

Quizplus · Accepted Answer

Typically, the stock prices of acquiring (buying) banks in mergers and acquisitions may experience volatility, but there's no rule that they usually increase, and especially not with a specific cap like 5 percent. Often, the acquiring company's stock might drop initially due to the costs associated with the merger or acquisition.

Buying Banks Involved in Mergers Usually Experience Increases in the Price