The impact of mergers in banking : Evidence from a nationwide sample of federally chartered banks

Spurred by deregulation, cost, and risk factors, commercial bank mergers have accelerated sharply in recent years. Many banks appear to be positioning themselves for the advent of interstate banking through holding company or reciprocal branching arrangements. Yet, the performance effects of mergers among operating U.S. banks (as opposed to holding company acquisitions) have been examined both infrequently and inconclusively. This study focuses upon the characteristics and performance effects of national bank mergers occurring during the 1970–1980 period. Acquiring national banks were found to have lower operating efficiency and productivity than nonmerging banks and their profitability did not increase following the mergers, but credit availability, productivity, loan losses, deposit service charges, and interest-rate risk did rise. Frequency of merger activity did not significantly influence bank profitability or growth, but did augment stockholder risks and increase business and real-estate credit. In the aggregate, national bank mergers appeared to result neither in significant service benefits nor in significant service costs to the public.Spurred by deregulation of the industry, rising cost pressures, and increased operating risk, merger transactions among U.S. banks have soared in recent years. During the 1982–1986 period, for example, banking led all other industries in the number of consummated mergers and consistently was among the ten leading U.S. industries in the estimated market value of merger agreements. Moreover, the recent upsurge in reciprocal interstate banking agreements and proposals for fully legalized interstate banking hold out the prospect for a further acceleration in bank merger transactions in the years ahead. In view of the fact that legislation in more than 30 states now permits some form of interstate banking by merger or de novo entry and a June 1985 ruling of the U.S. Supreme Court has legitimized regional banking compacts, the public and private impact of bank mergers becomes of much greater importance as a research focus.Despite the magnitude of recent bank merger transactions and their implications for the public, the research literature in this area is surprisingly meager and often contradictory. This article is an attempt to focus more sharply on recent research findings, provide additional evidence concerning the effects of mergers on the financial performance of banks, and assess their impact on the public's interest in an adequate supply of financial services.     

论我国企业跨国并购的战略选择

随着我国企业实力的不断增强和竞争的加剧,越来越多的企业走出国门,开展跨国并购。企业开展跨国并购有利于获取我国经济发展所需的短缺资源和企业发展所需的技术、品牌和市场。目前,国内国际形势和国家政策导向都十分有利于企业"走出去"开展跨国并购。但由于我国企业规模小、实力弱及国内外文化环境、政治经济环境差异大,企业跨国并购也面临许多障碍。我国企业跨国并购要想取得成功,必须在并购主体、目标市场、并购行业、并购对象和并购方式等方面做出正确的战略选择,同时,我国政府也需要出台一些相应的扶持和鼓励措施。     

On the Scope of Conflict in International Merger Control

In this paper, we analyze the scope for conflict between national merger control agencies which simultaneously assert jurisdictions. We consider a positive model of merger control in which market definition and the analysis of dominance are both explicitly specified. Our main finding is that conflict in international merger control is less likely to occur when economic integration is high. Hence, economic integration should alleviate rather than exacerbate conflict. In addition, we observe that conflict is more likely to arise between countries of similar market size and for moderate competition policy rules.     

The Future of Estate Agency: Some Consequences of the Recent Acquisition Boom in South West England

The entrance of large financial institutions into the estate agency industry has transformed it from a cottage industry into one dominated by a few large national chains. Based on a postal questionnaire survey of estate agents in the South West and follow-up interviews of thirteen agents in the Plymouth travel-to-work area, this study considers the effects of the takeovers on the operations of estate agents and the future of the estate agency industry. It focuses on diversification, commission rates, attitudes to 1992, marketing and the future of the independent agent.     

Preference to Local Food vs. Preference to “National” and Regional Food

In the environment of globalisation and progressive liberalisation of the market, many small local producers were excluded from the market as uncompetitive to the producers realising scale economy due to their presence in large global market and being able to meet requirements of large retailers’ chains. As there is growing consumers’ interest to recover their identity, those of the local cultures and traditional values, there is a new chance for those small local producers. The problems of locally produced food recently awakened interest and aroused many discussions of practitioners and scholars as well. The aim of the presented study has been to test the parameters that influenced preferences among food product branded as national, regional, or local product. Presented models identified several consumers’ attitudes and feelings that are the main predictors of the relation between consumers’ preferences for local food and the preferences for national or regional food. Food made by local producers is perceived by consumers as being of higher quality and better complying with their habits and requirements than “regional” or “national” food products.     

Finance for SMEs: A U.K. Perspective

This paper provide an overview of recent trends in the financing of smaller businesses in the U.K. It refers in particular to the findings of a major recent programme of work in this area funded by the Economic and Social Research Council, in which the author participated. This programme included the first national survey to address these issues since the Bolton Report of 1971, as well as a range of projects covering the finance of ethnic businesses and hi-tech firms as well as the market for informal venture capital. On the basis of this work and of the results of more recent follow up surveyors it is concluded that the evidence for general equity or debt gaps in the U.K. is weak. If anything SME funding was too easy in the boom of the late 1980s. It is argued that consideration could be given to the promotion through seedcorn funding of SME co-operative or mutual guarantee schemes to reduce information asymmetry in U.K. credit markets.     

Manufacturer Mergers and Product Variety in Vertically Related Markets

We study the incentives of final product manufacturers to introduce new products into the market and the impact of a manufacturer merger on them. We show that when manufacturers distribute their products through multi-product retailers, a manufacturer merger, although it leads to an increase in the wholesale prices, it can enhance product variety. The merger induced product variety enhancement though arises only when vertical relations are present: when manufacturers sell directly their products to consumers, a merger never results in more product variety. Still, both with or without vertical relations, a manufacturer merger hurts consumers and decreases welfare.     

Firms' acquisition decisions and Tobin's q ratio

We develop the hypothesis that Tobin's q ratio signals favorable opportunities for a firm to make acquisitions and then undertake an empirical test of this hypothesis within the context of a more general “multicausal” model. The results of this test support our hypothesis. The empirical study is also notable in that our data consists of a representative sample of large manufacturing firms (selection to the sample is not conditional upon merger activity) and the time period covered (1971–1978) postdates the conglomerate merger boom era of the 1960s.     

Hong Kong's fast-food industry: An overview

Business continues to boom for Western quick-service operations in Hong Kong, including for those that see the territory as a jumping off point for capitalizing on the expanding mainland-China markets. But it's no longer just Western burger, chicken, and pizza chains that are competing in the market place: several Hong-Kong-based Chinese-style fast-food companies are growing quickly throughout the territory and elsewhere.     

外资并购对我国的影响及法律对策

随着经济全球化的发展,外资并购已成为国际直接投资的主要方式,这一方式在推动东道国经济的发展的同时,也会对东道国经济和社会的发展造成冲击.主要表现在:冲击国内市场份额、民族工业及国有品牌;冲击政府经济政策;阻碍获得国际先进技术等方面.对外资并购,我国应采取反并购的法律手段,健全关于规制外资并购的法律制度,完善外资并购的法律环境,有效规范、控制外资并购行为.     

SIMS: a Store Image Monitoring System

During the last decade the UK grocery trade has become increasingly competitive as national chains have fought for an increase in market share in a relatively static market place. Retailers have become more aggressive in their marketing strategies and tactics, one noticeable trend being a significant increase in promotion and advertising expenditure. To date, however, few studies have tackled the difficult question of evaluating the effectiveness of their advertising. The authors propose a system for continuous monitoring of the effects of advertising on retail store image using multidimensional scaling techniques, and demonstrate the system on a small-scale study of supermarket advertising.     

Wealth Effects of Takeovers in Merger Activity Eras: Empirical Evidence from the UK

Existing studies on the assessment of shareholders' gains in takeovers have not taken the characteristics of the prevailing economic activity period into consideration. This study investigates the wealth effects to shareholders in the event of a merger and acquisition transaction by analysing 124 cases in the UK. The paper differs from previous studies in that it examines the abnormal returns found in two different economic periods. These include a boom period, characterised by high merger activity era (HMAE) and a trough period, characterised by low merger activity era (LMAE). The sample firms were categorised into friendly mergers and hostile takeovers— both successful and unsuccessful. The empirical findings derived from this work revealed that upon the differentiation of the two periods, the wealth effects to shareholders in the different transactions is related to the prevailing performance of the economy.     

Merger drivers and the change of bidder shareholders' wealth

A growing number of merger studies concern the causality of firm performance and merger activity in the last decade, but with mixed results. Assuming semi-strong efficiency, this article argues that firms with good stock performance are more likely to acquire other firms. With 412 US-listed bidders, results from the event study method clearly support our hypothesis by showing a strong upward movement of cumulative abnormal returns across groups in the pre-merger period. Results also suggest that bidders of different characteristics have different preference for payment methods and thus the market reactions to them are different, despite the noise that frequently accompanies merger activity. These empirical outcomes are important to both investors and financial services companies including investment banks when knowledge about the market reactions to their clients in mergers is required.     

从关联产业间的周期关系看钢铁行业的荣衰变化——又到学习“邯钢经验”时

钢铁产业正进入高成本与低收入的困难时期,因此,前些年在高收入与低成本所造成的繁荣时期而被冷落的注重成本管理的“邯钢经验”又将会成为钢铁行业普遍重视的对象。这种情况是由钢铁行业与其上下游行业及国民经济的周期关系决定的。市场经济的基本矛盾和作用机制,使得决定利润率变化的各种性质不同的价格组合,一方面在每个产业内部都具有时间上的继起性,由此决定了每个部门周期的必然性,另一方面在存在着投入产出关系的各产业之间具有空间上的并存性和时间上的继起性,这决定了它们之间的周期关系是不完全同步的,因此,在任何时候都会出现“繁荣中的萧条”与“萧条中的繁荣”现象。不同部门之间既有差异但又具有较高同步性的周期关系,则决定着宏观经济的周期运动。宏观周期同样是由微观机制决定的。     

EU Merger Control and the Compatibility Test Revisited

EU merger policy is shaped and driven by the EU Merger Control Regulation (MCR). An essential element of this is the compatibility test, which determines whether a merger with a Community Dimension signifi cantly impedes competition, and therefore the merger’s compatibility with the common market. This article assesses two recent changes to the compatibility test, the 2004 MCR’s rewording of the test and the new foreseeable dominance variant as made law by the Court of First Instance and the European Court of Justice.     

欢盟外资并购国家安全审查制度对中国的启示

21世纪以来,欧盟主要国家纷纷修改外资并购立法,加大对外资并购国冢安全的审查,审查标准趋亍严格．审查范围愈发扩大。这种外资审查立法权扩张的冲动受到来自《欧共体条约》所确立的资本自由化原则的制约。在国际投资政策趋紧的背景下,中国公司近年来在欧美国家的外资并购不断受阻。深入理解欧盟外资并购立法的规定是当前中国企业制定国际化战略的基本要求。     

The rise of dollar credit in emerging market economies and US monetary policy

This paper examines the hypothesis that the boom in dollar credit in emerging market economies (EMEs) is associated with an excessively low interest rate in the US. For this purpose, we use a multivariate correlated unobserved component model that allows for correlation between shocks to dollar credit, cross‐border interest rate gaps—measured as the difference between emerging market interest rate and the US interest rate, and dollar index both in the short run and in the long run. In addition, it also provides us a quantitative estimate of the permanent and transitory movements in dollar credit in EMEs, interest rate gaps and dollar index. The results from this model do suggest that a temporary increase in interest rate gaps and decline in the dollar index are associated with a temporary increase in the dollar credit in EMEs with a very high degree of correlation. The estimate of the cyclical component of the dollar credit in EMEs from our model captures the recent boom and bust in this market and compares favourably to alternative trend–cycle decomposition methods.     

Managerial labor-market discipline and the characteristics of merger and acquisition transactions

This study evaluates how state regulation of noncompetition agreements affects merger and acquisition activity. Noncompetition agreements put restrictions on postemployment activities, thereby reducing management mobility and forcing top managers to bear the long-term consequences of their corporate decisions. In this sense, state regulation of noncompetition agreements functions as a mechanism to align management's interests with those of the shareholders when management makes major corporate decisions. To examine this hypothesis empirically, this study tests whether the legal enforcement of noncompetition agreements across states affects the choice of payment methods, the premium paid for targets, and the acquirers' abnormal returns on their merger or acquisition activity. The results suggest that stricter enforcement of noncompetition agreements significantly reduces the likelihood of using stock in takeovers and the premiums paid for targets. In addition, the study documents that stronger enforcement of noncompetition agreements is related with more favorable market reactions for large acquirers.     

论电子商务与跨国公司的竞争优势

20世纪90年代以来，网络、通讯和信息技术的发展，使真正意义上的电子商务应运而生。电子商务突破传统商务三大障碍，形成新经济运作三模式；电子商务使跨国公司重构价值健，尤其是优化了其供应健，降低了营运成本，它加强了跨国公司与客户之间的关系，增加了其全球客户量，提高了其产品差异能力。这些都直接增强了跨国公司的全球竞争优势。     

国际银行业并购的效应分析及对我国的启示

银行业的并购在金融业的发展中始终占据着重要地位,最近几年令人惊叹的银行并购浪潮中充分显示了这一点。面对国际金融服务领域更加激烈的竞争,为增强自身的竞争实力,众多的国际金融集团正在不断地合并、重组,以图在全球金融市场一体化的进程中占有一席之地。席卷全球的银行并购潮,正在促使全球银行业发生巨大的变革。