How does competition affect retail banking? Quasi-experimental evidence from bank mergers

• 成果类型: Article
• 署名作者: Liebersohn, Jack
• 署名单位: University of California System; University of California Irvine
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2024.103797
• 发表日期: 2024
• 关键词: Banking; Financial institutions; COMPETITION; ANTITRUST; deposits

摘要

This paper studies bank antitrust rules which discontinuously shift bank mergers' competitive impact. The likelihood of mandatory divestiture rises sharply for mergers in markets above a threshold level of concentration, leading to an increase in the number of banks in these markets. Consistent with greater competition, intervention leads to higher deposit rates. Mortgage originations rise by 11%, from both refinancing and purchases. However, small business loan quantities do not change. The effects of intervention do not dissipate over time, and nonbank lenders respond similarly to banks. Overall, antitrust rules can increase bank competition, but relationships protect banks from competitors.