Consolidation of Banks in Japan: Causes and Consequences

Kaoru Hosono, Koji Sakai and Kotaro Tsuru

No 13399, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We investigate the motives and consequences of the consolidation of banks in Japan during the period of fiscal year 1990-2004 using a comprehensive dataset. Our analysis suggests that the government's too-big-to-fail policy played an important role in the mergers and acquisitions (M&As), though its attempt does not seem to have been successful. The efficiency-improving motive also seems to have driven the M&As conducted by major banks and regional banks in the post-crisis period, while the market-power motive seems to have driven the M&As conducted by regional banks and corporative (shinkin) banks. We obtain no evidence that supports managerial motives for empire building.

JEL-codes: G21 G34 (search for similar items in EconPapers)
Date: 2007-09
New Economics Papers: this item is included in nep-ban, nep-com, nep-eff and nep-his
Note: ME IO
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Citations: View citations in EconPapers (17)

Published as Consolidation of Banks in Japan: Causes and Consequences , Kaoru Hosono, Koji Sakai, Kotaro Tsuru. in Financial Sector Development in the Pacific Rim , Ito and Rose. 2009

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Chapter: Consolidation of Banks in Japan: Causes and Consequences (2009)
Working Paper: Consolidation of Banks in Japan: Causes and Consequences (2007)
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