Bank mergers and acquisitions: Theory and application

Brett Kinlock Hyde, University of Texas at El Paso

Abstract

The conduct of banking in the United States is an extremely complex and dynamic industry. Throughout the last century, many laws and regulations have been enacted that have greatly impacted banking institutions. Two recent banking laws, the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 and the Financial Services Modernization Act of 1999 changed the laws regarding bank mergers and acquisitions which in turn changed the dynamics of the banking industry. Deregulation and enactment of these laws have allowed financial institutions to diversify products and services and to maximize profitability through mergers and acquisitions. ^ The bank merger process is a very involved process. Management teams need to be proactive in the company's implementation of strategies and objectives relating to the merger. With each merger or acquisition, there are positive and negative aspects which may or may not lead to a successful transaction. This report provides a case study of the acquisition of Sunwest Bank by Boatmen's Bancshares which demonstrates the aspects of a successful merger or acquisition. ^ Bank mergers and acquisitions have increased dramatically in the past few decades. In recent years, laws have changed to allow banks to buy non-financial institutions. This has caused a decrease in acquisitions and mergers of traditional banks and is increasing mergers and acquisitions with non-financial institutions. ^

Subject Area

Business Administration, Management|Business Administration, Banking

Recommended Citation

Hyde, Brett Kinlock, "Bank mergers and acquisitions: Theory and application" (2002). ETD Collection for University of Texas, El Paso. AAIEP26244.
http://digitalcommons.utep.edu/dissertations/AAIEP26244

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