What Is a Bank Merger?

A commercial bank merger is a legal act in which two or more commercial banks merge into one bank. There are two forms: absorption mergers and new mergers. Merger by absorption means that after the merger of two or more banks, one of the banks (the bank of the absorbing party) survives and the other bank (the bank of the absorbing party) is dissolved. If the three banks A, B, and C merge, after the merger, A continues to exist, and banks B and C disappear. ^[1]