Mergers and Acquisitions of Financial Institutions: A Review of the Post-2000 Literature

Abstract

Banks, Financial institutions, Literature review, Mergers and acquisitions, G21, G34,

Empire building? Analysing the drivers towards mega-mergers in the English housing association sector

“…Regime changes can have different levels of influence show that clustering of merger activity is also likely to occur in individual industries. There is also a large body of financial literature that argues that changes in monetary (Schwartz 2002, Campello 2002, DeYoung et al 2009 and fiscal (Ghosh & Jain 2000) policy may be critical to this process and systematically affect the market. In addition, Rhodes-Kropf and Viswanathan (2004) show that changes in the financial market may also induce incentives for firms to merge.…”

Are All Bank Acquisitions Equal? The Impact of Bank Mergers and Acquisitions around the 2007-2009 Financial Crisis: Evidence from TARP

“…The Interstate Banking and Branching Efficiency Act (IBBEA) of 1994, and the Gramm-Leach-Bliley Act (GLBA) of 1999, encouraged interstate banking; allowing commercial banks to undertake the role of investment banks and insurance companies. Importantly, these financial deregulations enabled commercial banks to expand into geographic markets and product markets through consolidating activities [11]. In addition, rapid developments in computer science and communication technology have contributed to technological innovations in the back-office processing, front-office delivering system and payment systems, help improved the operating efficiency, enabled the branching strategy that aimed to take advantage of geographical diversification and the economies of scale [12].…”

“…In contrast, smaller and/or less financially sound banks tended to become takeover targets to larger and better diversified competitors [11]. A motivating factor was the rapid development in evolvement of financial system which increased the market competition and market concentration.…”

Cross-border banking, bank market structures and market power: Theory and cross-country evidence

“…the most productive, foreign banks tend to take over the best domestic banks in each market segment ( Vander Vennet and Gropp 2003). The literature on bank mergers and acquisitions finds that mergers have resulted in efficiency gains (DeYoung et al 2009). Based on these findings, foreign takeovers are modeled as follows (De Blas and Russ 2010a).…”