Abstracts » Business

Discussion comments on US banking consolidation and efficiency

Article Abstract:

Article presents a discussion on how issues of cost efficiency arise in policymaking and the methodology used to study the issue of efficiency in the financial services industry. Author identifies specific situations on the issue of cost efficiency, one arising from applications to the Board to engage in mergers and acquisition and second, the Board's consideration of appropriate expanded powers for banking organizations. Regarding methodology, the persistent differences between economists and bankers on predicting efficiency implications of mergers is mentioned.

Industrial efficiency, Economic efficiency

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Performance economies associated with small and medium sized bank mergers

Article Abstract:

Article examines whether cost economies of banks in this study were confined to small bank mergers. The study identified mergers in which post-merger assets were less than $150 million as small bank mergers and banks with post-merger assets greater than $150 million as medium or large mergers. Improvements in margins relative to non-merging banks seemed to be the primary source of gains. The median change in asset utilization was not significantly different from the median change among control institutions in small, medium or large banks.

Economies of scale

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