Exploring the Success of Regional Bank Mergers: Financial Versus Non-Financial Performance

Brunner-Kirchmair Thomas M. () and Burgstaller Johann ()
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Brunner-Kirchmair Thomas M.: Johannes Kepler University, Institute of Finance, Altenberger Strasse 69, 4040 Linz, Austria
Burgstaller Johann: Johannes Kepler University, Institute of Finance, Altenberger Strasse 69, 4040 Linz, Austria

German Economic Review, 2025, vol. 26, issue 3, 267-304

Abstract: This study examines effects of mergers between Austrian banks from 2005 to 2018. Using matching techniques, we assess consequences for bank profitability and financial efficiency, as well as the impact on loan growth and a measure of social efficiency. Significant effects are observed in naive comparisons to non-merging banks, which almost entirely disappear after balancing with bank-level and environmental factors. This indicates that the average bank merger is neither value-decreasing nor value-enhancing. However, variation in individual merger success is huge and associated with several organizational and strategic factors, such as pursued cuts in personnel expenses or changes in market power.

Keywords: bank mergers; savings banks; cooperative banks; bank performance; merger success; matching technique (search for similar items in EconPapers)
JEL-codes: G21 G34 R51 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1515/ger-2024-0068

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