In a recent Chicago Fed Letter, the author examined the motivations for, and the consequences of, the tremendous wave of U.S. bank mergers during the 1980s and 1990s. In that document, he reached three main conclusions. First, he argued there is little evidence of any systematic reduction in competition in retail banking or small business financing markets as a result of the bank merger wave. Although the largest commercial banks have a much more prominent national position today than 20 years ago, these banks’ shares of local banking markets have not increased materially.
Chicago Fed Letter, No. 150, February 2000
Mergers and the Changing Landscape of Commercial Banking (Part II)