We model the impact of bank mergers on loan competition, reserve holdings and aggregate liquidity. A merger creates an … internal money market that affects reserve holdings and induces financial cost advantages, but also withdraws liquidity from … liquidity. Mergers among large banks tend to increase aggregate liquidity needs and thus the liquidity provision in monetary …

This paper investigates the association between market power and bank liquidity across 113 developed and developing … Methods of Moments estimators, we find an inverse U-shaped relation between bank market power and liquidity. It shows that … market power, ceteris paribus, banks in developed nations have lower investment in asset liquidity, attract more transaction …