Abstract | This paper is the first to examine the effects of international bank mergers and acquisitions on acquirers' contribution to systemic risk covering also six years after the2007-09 global financial crisis. Our sample consists of 608 international bank mergers involved domestic and cross-border mergers as well as bank and non-bank targets. Using the marginal expected shortfall as well as conditional value-at-risk as systemic risk measurement, we find that on average, mergers do not impact on the acquiring banks’ contribution to systemic risk regardless of the increased potential for risk diversification exhibited by cross-border and cross-industry bank mergers. However, for deals financed by cash only and much smaller compared to acquirers as well as involved private targets, acquirers' contribution to systemic risk increase after the merger. |
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