@article{4f3c8ed8946441dc839c09cf7a7d7499,
title = "Bank Consolidation and Soft Information Acquisition in Small Business Lending",
abstract = "We empirically examine the impact of bank consolidation on bank acquisition of soft information about borrowers. Using a dataset of small business financing, we find that mergers of small banks have a negative impact on soft information acquisition, whereas mergers of large banks have no impact. We also find some evidence that an increase in organizational complexity upon a merger, rather than a post-merger cost-cut, is likely to cause a negative and significant impact on soft information acquisition by small banks. These findings are consistent with the organizational theory that predicts a comparative advantage of simple and flat organizations in acquiring and processing soft information.",
keywords = "Bank consolidation, Bank merger, Decision authority, Information acquisition",
author = "Yoshiaki Ogura and Hirofumi Uchida",
note = "Funding Information: This paper is a result of the research performed at the Industrial and Financial Structure Workshop at the Research Institute of Economy, Trade, and Industry (RIETI) in Japan. This paper was presented at the Contract Theory Workshop, the Conference on Mergers and Acquisitions of Financial Institutions (hosted by the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Bank of Chicago, and Journal of Financial Services Research), Kwansei Gakuin University, the Japan Society of Monetary Economics, the Japanese Economic Association, Chuo University, and the RIETI. We are grateful to Ken{\textquoteright}ichi Amaya, Munetomo Ando, Ken Cyree, Kohei Daido, Kozo Harimaya, Yuji Honjo, Hideshi Ito, Shinsuke Kambe, Kenji Kutsuna, Toshihiro Okada, Eiji Okuyama, Tetsuya Shinkai, Atsushi Tanaka, and Larry Wall for their insightful comments. We also gratefully acknowledge the financial support by the Daiginkyo Forum of the Osaka Bankers{\textquoteright} Association. This study is partly supported by a Grant-in-Aid for Scientific Research, Japan Society for the Promotion of Science (Subject No.18730215 and No.21330076).",
year = "2014",
month = apr,
doi = "10.1007/s10693-013-0163-5",
language = "English",
volume = "45",
pages = "173--200",
journal = "Journal of Financial Services Research",
issn = "0920-8550",
publisher = "Springer Netherlands",
number = "2",
}