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Determinants of mergers and acquisitions among Finnish cooperative and savings banks

Author

Listed:
  • Matias Huhtilainen

    (University of Eastern Finland)

  • Jani Saastamoinen

    (University of Eastern Finland)

  • Niko Suhonen

    (University of Eastern Finland)

Abstract

This study is the first to examine mergers and acquisitions among small, regional stakeholder banks that belong to the same group. Using data on Finnish unlisted cooperative and savings banks, we investigate the relationship between bank-specific factors and the likelihood of a bank being an acquirer or an acquisition target. We find that large banks tend to acquire small and inefficient banks. Additionally, we examine the loan growth and find a negative (positive), statistically significant association with the likelihood of a bank being an acquisition target (acquirer). Finally, we document an increase in the likelihood of a bank being an acquisition target subsequent to an increase in the share of net fees and commission income against total assets.

Suggested Citation

  • Matias Huhtilainen & Jani Saastamoinen & Niko Suhonen, 2022. "Determinants of mergers and acquisitions among Finnish cooperative and savings banks," Journal of Banking Regulation, Palgrave Macmillan, vol. 23(3), pages 339-349, September.
  • Handle: RePEc:pal:jbkreg:v:23:y:2022:i:3:d:10.1057_s41261-021-00170-4
    DOI: 10.1057/s41261-021-00170-4
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    More about this item

    Keywords

    Mergers and acquisitions; Stakeholder banks; Banking sector consolidation;
    All these keywords.

    JEL classification:

    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure

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