Surviving Merger Commercial Bank Mergers on Rural

For over 50 years in the middle of the 20’h century we had financial institutions that were bounded geographically as well as by type of product or service. They were insulated from other financial and non-financial institutions by restrictive charters and by regulations designed to limit competition between charters. All of this was in the name of safety and soundness, an outgrowth of the financial crisis of the 1920s and early 1930s. During this time, most financing in rural areas came through these regulated financial institutions. In the 1970s and early 1980s this fixed regime began to evidence major strains from a changing economy. So began a period of evolution that is still underway. The boundaries of the regulated institutions were relaxed and the significance of unregulated suppliers grew. Innovations in computers, communications, and financial instruments also developed at a rapid pace, adding new kinds of strains. New economies of size caused institutions to need to grow. New complementarities among financial products and new substitutes for traditional products arose in a flurry of financial innovation. A re-interpretation of the safety and soundness standards of the 1930s became necessary,