The effects of bank mergers and acquisitions on small business lending
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We examine the effects of bank M&As on small business lending using data on over 6000 recent U.S. bank M&As. We are the first to decompose the impact of M&As into the static effects from simply melding the antecedent institutions and the 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.
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One study measured the effects of M&As on the lending of other banks in the same local markets and found evidence suggesting that changes in the supplies of small business credit by these other banks tended to offset much, if not all, of the negative effects on small business lending of M&As.
“One study measured the eects of M&As on the lending of other banks in the same local markets and found evidence suggesting that changes in the supplies of small business credit by these other banks tended to oset much, if not all of the negative eects on small business lending of M&As (Berger et al., 1998).”
From The economics of small business finance: The roles of private equity and debt markets in the financial growth cycle (1998) · cites this paper as Berger et al., 1998
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Cites
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Cited by
Sorted by citations
N. Berger, A., & F. Udell, G. (1998) · Journal of Banking & Finance · doi:10.1016/s0378-4266(98)00038-7 · Cited by 3,690 · see citing works
Self-citationEntrepreneurship and bank credit availability
Black, S. E., & Strahan, P. E. (2002) · The Journal of Finance · doi:10.1111/1540-6261.00513 · Cited by 1,140 · see citing works
Competition, Adverse Selection, and Information Dispersion in the Banking Industry: Table 1
Marquez, R. (2002) · Review of Financial Studies · doi:10.1093/rfs/15.3.901 · Cited by 417 · see citing works
- Authors
- Berger, A. N., Saunders, A., Scalise, J. M., & Udell, G. F.
- Affiliations
- Federal Reserve (US)
- New York University (US)
- University of Pennsylvania (US)
- Indiana University Bloomington (US)
- Corresponding author
- Berger, Allen N
- Venue
- Journal of Financial Economics
- Publisher
- Elsevier BV
- Published
- 1998-11
- Volume
- 50
- Issue
- 2
- Pages
- 187-229
- ISSN
- 0304-405X (ISSN-L)
- OpenAlex
- W1928404015
- Cited by
- 827
- References
- 1
- Citations by year
- 2026: 30 · 2025: 24 · 2024: 16 · 2023: 20 · 2022: 21 · 2021: 28 · 2020: 19 · 2019: 16 · 2018: 25 · 2017: 18 · 2016: 25 · 2015: 34 · 2014: 29 · 2013: 27 · 2012: 23
- FWCI
- 60.78
- Type
- journal article
- Language
- en
- Open access
- hybrid
- doi.org
- Licence
- Locations
- Journal of Financial Economics (publishedVersion, cc-by-nc-nd)
- SSRN Electronic Journal (acceptedVersion)
- Faculty Digital Archive (New York University Florence) (submittedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Finance › Banking stability, regulation, efficiency
- Social Sciences › Business, Management and Accounting › Accounting › Corporate Finance and Governance
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Merger and Competition Analysis
- Keywords
- bank mergers and acquisitions, small business lending, bank consolidation, bank competition, small business financing
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