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The Effects of Bank Mergers and Acquisitions on Small Business Lending

47 Pages Posted: 7 Nov 2008  

Allen N. Berger

University of South Carolina - Darla Moore School of Business; Wharton Financial Institutions Center; European Banking Center

Anthony Saunders

New York University - Leonard N. Stern School of Business

Joseph M. Scalise

University of Pennsylvania, Wharton School; Bain & Company

Gregory F. Udell

Indiana University - Kelley School of Business - Department of Finance

Multiple version iconThere are 3 versions of this paper

Date Written: January 1998

Abstract

We examine the effects of bank M&As on small business lending using data on over 6,000 recent U.S. bank M&As. We are the first to decompose the impact of M&As into static effects from simply melding the antecedent institutions, and dynamic effects associated with post-M&A refocusing of the consolidated institution. We are also the first to estimate the dynamic reactions of other local banks. We find that the static effects of consolidation reduce small business lending, but are mostly offset by the reactions of other banks, and in some cases also by refocusing efforts of the consolidating institutions themselves.

Keywords: Bank, Mergers, Small Business

Suggested Citation

Berger, Allen N. and Saunders, Anthony and Scalise, Joseph M. and Udell, Gregory F., The Effects of Bank Mergers and Acquisitions on Small Business Lending (January 1998). NYU Working Paper No. FIN-98-007. Available at SSRN: https://ssrn.com/abstract=1296402

Allen N. Berger (Contact Author)

University of South Carolina - Darla Moore School of Business ( email )

1705 College St
Francis M. Hipp Building
Columbia, SC 29208
United States
803-576-8440 (Phone)
803-777-6876 (Fax)

Wharton Financial Institutions Center

Philadelphia, PA 19104-6367
United States

European Banking Center

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Anthony Saunders

New York University - Leonard N. Stern School of Business ( email )

44 West 4th Street
9-190, MEC
New York, NY 10012-1126
United States
212-998-0711 (Phone)
212-995-4220 (Fax)

Joseph M. Scalise

Bain & Company

Two Copley Place
Boston, MA 02118

University of Pennsylvania, Wharton School ( email )

3641 Locust Walk
Philadelphia, PA 19104-6365
United States

Gregory F. Udell

Indiana University - Kelley School of Business - Department of Finance ( email )

1309 E. 10th St.
Bloomington, IN 47405
United States

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