Divestiture as an Antitrust Remedy in Bank Mergers

25 Pages Posted: 26 Aug 1998

See all articles by Jim Burke

Jim Burke

Board of Governors of the Federal Reserve System

Date Written: December 30, 1997

Abstract

The purpose of this study is to determine whether, from a public policy standpoint, divestitures constitute an effective antitrust remedy in bank merger cases. A number of findings emerge from the study: Divested branches have a remarkable survival record; structural changes effected by divestitures tend to persist over time; larger buyers of divested branches tended to be more successful than smaller buyers; divestiture of the target institutions' branches rather than those of applicants proved preferable from an antitrust standpoint; and divested branches selected by the Department of Justice do not perform better than others. The findings suggest that divestitures of bank offices have generally provided an effective public policy remedy.

JEL Classification: L49, G21

Suggested Citation

Burke, Jim, Divestiture as an Antitrust Remedy in Bank Mergers (December 30, 1997). Available at SSRN: https://ssrn.com/abstract=119169 or http://dx.doi.org/10.2139/ssrn.119169

Jim Burke (Contact Author)

Board of Governors of the Federal Reserve System

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
348
Abstract Views
2,084
rank
93,944
PlumX Metrics