The DOJ guidelines are applicable to mergers in all industries, not just banking.
3
Holder (1993) contains a detailed description of the antitrust review of bank mergers.
4
The guidelines actually state than an increase of more than 50 points is unacceptable in a highly concentrated market. However, banks are held to a less-restrictive standard in light of the substantial competition they face from non-depository financial institutions.
5
A wide variety of factors may mitigate anti-competitive effects. Factors that measure competition from thrifts and non-bank firms, public benefits and the attractiveness of the market for entry by new banks are typically considered.
6
The Federal Reserve regulates bank holding companies and state member banks. The Comptroller of the Currency oversees national banks, while the Federal Deposit Insurance Corp. regulates state banks that are not Fed members. The DOJ reviews all three regulators' decisions and can sue to block any mergers it finds anti-competitive.
7
See Burke (1998).
8
See Baker (1992). The courts ruled against this narrow product market in the only case ever litigated on this issue. The DOJ has continued to focus on commercial loans, however. One side effect of divestiture has been the almost total elimination of anti-trust litigation in banking over the past 20 years. Without such litigation, the courts have not clarified or updated their earlier product market definition.
9
See Keenan (1999).
FOR FURTHER READING
Baker, Donald I. "Searching for an Antitrust Beacon in the Bank Merger Fog," The Antitrust Bulletin (Fall 1992), pp. 651-66.
Burke, Jim. "Divestiture as an Anti-trust Remedy in Bank Mergers," Finance and Economics Discussion Series Working Paper 1998-14, Board of Governors of the Federal Reserve System (February 1998).
Holder, Christopher L. "Competitive Considerations in Bank Mergers and Acquisitions: Economic Theory, Legal Foundations, and the Fed," Economic Review, Federal Reserve Bank of Atlanta (January/ February 1993), pp. 23-36.
Keenan, Charles. "Justice Dept. Aims to Make Deal Spinoffs Competitive," American Banker, December 15, 1999, p. 1.