Keywords: Banking acquisitions mergers
Abstract: This paper uses a large sample of individual banking organizations, observed from 1996 to 2003, to
investigate the characteristics that made them more likely to be acquired. We use a definition
of acquisition that we consider preferable to that used in much of the previous literature, and
we employ a competing-risk hazard model that reveals important differences that depend on the
type of acquirer. Since interstate acquisitions became more numerous during this period, we
also investigate differences in the determinants of acquisition between in-state and out-of-state
acquirers. The hypothesis that acquisitions serve to transfer resources from less efficient to
more efficient uses receives substantial support from our results, as do a number of other relevant hypotheses.
Full paper (157 KB PDF)
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Last update: November 21, 2006