Carow, Kenneth A.Kane, Edward J.Narayanan, Rajesh2014-10-072003-07Carow, K. A., Kane, E. J., & Narayanan, R. (2003). How have borrowers fared in banking mega-mergers? (No. w10623). National Bureau of Economic Research.https://hdl.handle.net/1805/5201Previous studies of event returns surrounding bank mergers show that banks gain value in megamergers and additional value when they absorb in-market competitors. A portion of these gains has been traced to the increased bargaining power of banks vis-à-vis regulators and other competitors. We demonstrate that increased bargaining power of megabanks adversely affects loan customers of the acquired institution. Wealth losses are greater when loan customers are credit-constrained, the loan customer is smaller, or the acquisition is an in-market deal. These findings reinforce complaints that the ongoing consolidation in banking has unfavorably affected the availability of credit for smaller firms and especially capital-constrained firms.en-USbank mergersmegamergersborrowersWorking Paper