Figure 1: Number of bank mergers by year.
This figure illustrates the number of bank mergers by year from
1996-2021. The bars represent the number of bank mergers in our sample
(left axis) involving banks that have filed HMDA reports. The solid line
shows the total number of bank mergers (right axis). The percentages
above each bar indicate the proportion of all mergers involving two HMDA
filers that are included in our sample of bank mergers for each year.
Source: NIC.
This figure illustrates the number of bank mergers by year from 1996-2021. The bars represent the number of bank mergers in our sample (left axis) involving banks that have filed HMDA reports. The solid line shows the total number of bank mergers (right axis). The percentages above each bar indicate the proportion of all mergers involving two HMDA filers that are included in our sample of bank mergers for each year.
Figure 2: Average abnormal interest rates (r*)
This figure plots the evolution of average residualized interest
rates around merger events for acquiring banks (red dashed), target
banks (green short-dashed), and control banks (blue solid). Each panel
corresponds to a different merger type based on acquirer and target bank
sizes. The vertical line at quarter zero denotes merger completion.
Abnormal interest rates (r*) are the residual
mortgage interest rate (in percentage points) after controlling for loan
characteristics and county-quarter fixed effects, estimated using
regression (1). Source: Authors’
calculations using cHMDA and McDash Analytics (ICE) data.
This figure plots the evolution of average residualized interest rates around merger events for acquiring banks (red dashed), target banks (green short-dashed), and control banks (blue solid). Each panel corresponds to a different merger type based on acquirer and target bank sizes. The vertical line at quarter zero denotes merger completion. Abnormal interest rates (r∗) are the residual mortgage interest rate (in percentage points) after controlling for loan characteristics and county-quarter fixed effects, estimated using regression (1).
Figure 3: Stacked panel DiD – interest rates
This figure presents DiD estimates of merger effects on residualized
interest rates (r*). Points represent
treatment effect coefficients (βτ)
with 95% confidence intervals, showing how acquiring banks’ rates evolve
relative to control banks at each quarter relative to merger completion.
Each panel corresponds to a different merger type. The specification
includes bank-county-merger and time fixed effects to control for
compositional changes and time-varying shocks. r* is the residual
mortgage interest rate (in percentage points) after controlling for loan
and borrower characteristics and county-quarter fixed effects.
Source: Authors’ calculations using cHMDA and McDash Analytics
(ICE) data.
This figure presents DiD estimates of merger effects on residualized interest rates (r∗). Points represent treatment effect coefficients (βτ ) with 95% confidence intervals, showing how acquiring banks’ rates evolve relative to control banks at each quarter relative to merger completion. Each panel corresponds to a different merger type. The specification includes bank-county-merger and time fixed effects to control for compositional changes and time-varying shocks. r∗ is the residual mortgage interest rate (in percentage points) after controlling for loan and borrower characteristics and county-quarter fixed effects.
Figure 4: Average mortgage approval rates
This figure plots the evolution of average mortgage approval rates
around merger events for acquiring banks (red dashed), target banks
(green short-dashed), and control banks (blue solid). Each panel
corresponds to a different merger type based on acquirer and target bank
sizes. The vertical line at quarter zero marks merger completion.
Approval rate is the fraction of mortgage applications approved by a
lender in a given county-quarter. Source: Authors’ calculations
using cHMDA and McDash Analytics (ICE) data.
This figure plots the evolution of average mortgage approval rates around merger events for acquiring banks (red dashed), target banks (green short-dashed), and control banks (blue solid). Each panel corresponds to a different merger type based on acquirer and target bank sizes. The vertical line at quarter zero marks merger completion. Approval rate is the fraction of mortgage applications approved by a lender in a given county-quarter.
Figure 5: Stacked panel DiD – approval rates
This figure presents DiD estimates of merger effects on mortgage
approval rates. Points represent treatment effect coefficients (βτ)
with 95% confidence intervals, showing how acquiring banks’ approval
rates evolve relative to control banks at each quarter relative to
merger completion. Each panel corresponds to a different merger type.
Approval rate is the fraction of mortgage applications approved by the
lender. Source: Authors’ calculations using cHMDA and McDash
Analytics (ICE) data.
This figure presents DiD estimates of merger effects on mortgage approval rates. Points represent treatment effect coefficients (βτ ) with 95% confidence intervals, showing how acquiring banks’ approval rates evolve relative to control banks at each quarter relative to merger completion. Each panel corresponds to a different merger type. Approval rate is the fraction of mortgage applications approved by the lender.
Figure 6: Average delinquency rates of newly originated mortgages
This figure plots the evolution of average delinquency rates for
newly originated mortgages around merger events for acquiring banks (red
dashed), target banks (green short-dashed), and control banks (blue
solid). Each panel corresponds to a different merger type. The vertical
line at quarter zero marks merger completion. Delinquency is defined as
mortgages that become 90+ days delinquent or experience foreclosure,
bankruptcy, or similar adverse outcomes at any point through the
mortgage’s life. Source: Authors’ calculations using cHMDA and
McDash Analytics (ICE) data.
This figure plots the evolution of average delinquency rates for newly originated mortgages around merger events for acquiring banks (red dashed), target banks (green short-dashed), and control banks (blue solid). Each panel corresponds to a different merger type. The vertical line at quarter zero marks merger completion. Delinquency is defined as mortgages that become 90+ days delinquent or experience foreclosure, bankruptcy, or similar adverse outcomes at any point through the mortgage’s life.
Figure 7: Stacked panel DiD – delinquency rates
This figure presents DiD estimates of merger effects on delinquency
rates for newly originated mortgages. Points represent treatment effect
coefficients (βτ)
with 95% confidence intervals, showing how acquiring banks’ delinquency
rates evolve relative to control banks at each quarter relative to
merger completion. Each panel corresponds to a different merger type.
Delinquency rate is the fraction of newly originated mortgages in a
bank-county-quarter that become 90+ days delinquent or experience
foreclosure, bankruptcy, or similar adverse outcomes at any point during
the sample period. Source: Authors’ calculations using cHMDA
and McDash Analytics (ICE) data.
This figure presents DiD estimates of merger effects on delinquency rates for newly originated mortgages. Points represent treatment effect coefficients (βτ ) with 95% confidence intervals, showing how acquiring banks’ delinquency rates evolve relative to control banks at each quarter relative to merger completion. Each panel corresponds to a different merger type. Delinquency rate is the fraction of newly originated mortgages in a bank-county-quarter that become 90+ days delinquent or experience foreclosure, bankruptcy, or similar adverse outcomes at any point during the sample period.
Figure 8: Distribution of mortgage lenders and market concentration across
county-quarters
(a) Number of lenders (county-quarter)
(b) HHI (county-quarter)
Panel (a) shows the distribution of the number of mortgage lenders (at parent level) operating in each county-quarter. Panel (b) presents the distribution of the HHI calculated from lender market shares at the county-quarter level. Number of lenders is the total number of distinct lenders (banks and non-banks, at the parent company level) originating at least one mortgage in a county-quarter. HHI is the Herfindahl-Hirschman Index, calculated as the sum of squared market shares (in decimal form) of all lenders in a county-quarter, scaled by 10,000 (range: 0–10,000).
Figure 9: Geographic distribution of mortgage lenders across U.S. counties
This figure maps the number of active mortgage lenders across U.S.
counties, during our sample period (averaged). Darker shading indicates
a higher number of lenders. Number of lenders is the total number of
distinct lenders (at the parent company level) originating at least one
mortgage in a county-quarter. Source: Authors’ calculations
using cHMDA data.
This figure maps the number of active mortgage lenders across U.S. counties, during our sample period (averaged). Darker shading indicates a higher number of lenders. Number of lenders is the total number of distinct lenders (at the parent company level) originating at least one mortgage in a county-quarter.
Figure 10: Evolution of market structure around bank mergers
(a) Number of lenders (county-quarter)
(b) HHI (county-quarter)
Panel (a) shows the average number of lenders per county-quarter from 8 quarters before to 8 quarters after merger completion for three merger types. Panel (b) shows the average county-quarter HHI over the same event window. The vertical line at quarter zero denotes merger completion. Number of lenders is the count of distinct lenders (at the parent company level) active in a county-quarter. HHI is the Herfindahl-Hirschman Index, calculated as the sum of squared market shares (in decimal form) of all lenders in a county-quarter, scaled by 10,000 (range: 0–10,000).
Figure OA.1: Average lender fees around bank mergers
This figure plots the evolution of average lender fees around merger
events for acquiring banks (red dashed), target banks (green
short-dashed), and control banks (blue solid). Each panel corresponds to
a different merger type based on acquirer and target bank sizes. The
vertical line at quarter zero marks merger completion. Lender fees are
fees charged by the lender for processing and underwriting the mortgage,
excluding third-party costs.
This figure plots the evolution of average lender fees around merger events for acquiring banks (red dashed), target banks (green short-dashed), and control banks (blue solid). Each panel corresponds to a different merger type based on acquirer and target bank sizes. The vertical line at quarter zero marks merger completion. Lender fees are fees charged by the lender for processing and underwriting the mortgage, excluding third-party costs.
Figure OA.2: Stacked panel DiD – Lender fees
This figure presents DiD estimates of merger effects on lender fees.
Points represent treatment effect coefficients (βτ)
with 95% confidence intervals, showing how acquiring banks’ lender fees
evolve relative to control banks at each quarter relative to merger
completion. Each panel corresponds to a different merger type. The
specification includes bank-county-merger and time fixed effects. Lender
fees are fees charged by the lender for processing and underwriting the
mortgage, excluding third-party costs.
This figure presents DiD estimates of merger effects on lender fees. Points represent treatment effect coefficients (βτ) with 95% confidence intervals, showing how acquiring banks’ lender fees evolve relative to control banks at each quarter relative to merger completion. Each panel corresponds to a different merger type. The specification includes bank-county-merger and time fixed effects. Lender fees are fees charged by the lender for processing and underwriting the mortgage, excluding third-party costs.
Figure OA.3: Pre-merger and pre-vs-post-merger rate distributions across bank
types
This figure presents empirical cumulative distribution functions
(ECDFs) of residualized interest rates (r*). Panels (a) and (c)
compare the pre-merger distributions of control banks (blue dashed),
target banks (red solid), and acquiring banks (green solid), separately
by merger type. Panels (b) and (d) compare the pre-merger (blue dashed)
and post-merger (red solid) distributions for acquiring banks only,
separately by merger type. If acquirers changed their pricing strategies
post-merger, the pre- and post-merger distributions in panels (b)
and (d) would diverge. r* is the residual
mortgage interest rate (in percentage points) after controlling for loan
and borrower characteristics and county-quarter fixed effects.
This figure presents empirical cumulative distribution functions (ECDFs) of residualized interest rates (r∗). Panels (a) and (c) compare the pre-merger distributions of control banks (blue dashed), target banks (red solid), and acquiring banks (green solid), separately by merger type. Panels (b) and (d) compare the pre-merger (blue dashed) and post-merger (red solid) distributions for acquiring banks only, separately by merger type. If acquirers changed their pricing strategies post-merger, the pre- and post-merger distributions in panels (b) and (d) would diverge. r∗ is the residual mortgage interest rate (in percentage points) after controlling for loan and borrower characteristics and county-quarter fixed effects.