mergers and acquisitions question (1 Viewer)

[sandra]

Hi,

I was wandering if anyone knows what happens to the short run profits and the long run profits after a merge (particularly a bank merge) ? i cant find anything on this at all.. do they behave like monopolies or oligopolies or what ? and what are the demand and supply elasticities for the banking industry.. what does that even mean !!!! also does anyone know where i could find inofrmation on impact of mergers on the banking industry i cant find ANYTHING anywhere thanks for any help..

 

[pete_mate]

you dont know what supply and demand elasticity is, are you even doing a business degree?

 

[sandra]

i meant i dont know what the demand and supply elasticities for banking is. is it demand and supply elasticities for specific producs, loans in general or what and where do u find the elasticities. or do u estimate based on substitutability of goods? i dont understand what im supposed to say on it.

 

[pete_mate]

well they're obviously oligopolies

i guess that the commercial bank's main product would just be money, the lending of money, so that the price is just interest rates.
although there are account keeping fees,

but it's pretty hard to change a home loan, there are exit fees and entry fees, i'd say that the elasticity of demand is quite low.

the supply curve would be qutie complex, there's only so much funds in australia as regulated by the RBA

 

[sandra]

thanks !