Computers as a Tool for Bank Merger Analysis

Small computers allow business lawyers to bring their special expertise to bear on mixed legal, economic, and financial issues more fully and accurately than before. Although computers can handle a mass of information rapidly and precisely, they cannot develop creative ideas or strategies. Their output should be noted but not taken literally. These points are illustrated by a hypothetical proposed merger of 2 banks. Two developments in the near future should aid computerized competitive analysis: 1. improved technology to feed data into the computer, and 2. standardized and simpler computer operation. Use of the computer in merger analysis could make the repetitive calculations needed in the early stages much faster and cheaper. More importantly, a computer could estimate alternatives in numbers and with a speed and accuracy that would otherwise be impossible.