Value creating mergers – British bank consolidation, 1885-1925

Fabio Braggion, Narly Dwarkasing and Lyndon Moore

No 14663, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: The British banking sector had many small banks in the mid-nineteenth century. From around 1885 until the end of World War One there was a process of increasingly larger mergers between banks. By the end of the merger wave the English and Welsh market was highly concentrated, with only five major banks. News of a merger brought a persistent rise in the share prices of both the acquiring and the target bank (roughly 1% and 7%, respectively). Non-merging banks, especially those whose local market concentration rose as a result of the merger, saw their stock prices rise.

Keywords: Great britain; Banking; Mergers and acquisitions (search for similar items in EconPapers)
JEL-codes: G34 N23 N24 (search for similar items in EconPapers)
Date: 2020-04
New Economics Papers: this item is included in nep-com and nep-his
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