This paper examines the impact of mergers and acquisitions (M&A) on the financial performance of the Nigerian market after consolidation. The authors use data from all Nigerian banks that survived the consolidation between 2001 and 2009. Logistic regression models are structured to determine the influence of M&A activities on the financial performance of the Nigerian market. Also, the authors critically evaluate the findings by shedding the light on the lessons other developing nations can learn from the Nigerian market. The results show that M&A have a positive influence on the financial performance of the Nigerian market. Still, M&A are not enough to achieve the wider objectives of banking sector reform. Towards this end, corporate governance reform must take place vis-à-vis consolidation exercises especially when these M&A are regulatory based rather than market based. The investigation uses a novel approach by comparing pre- and post- M&A results performance of merged banks as well as comparing these results with non-merged banks. Finally, the paper puts the results in context of the wider reform context and considers the effectiveness of the M&A as a tool for banking sector reform in developing countries. The investigation offers insights into the policy of banking consolidation which can be useful for policy makers in Nigeria and other similar economies.