The first of these papers, dealing with mergers and acquisitions, found virtually no statistical support for the view that either the level of, or changes in, excess regulatory capital have played a role in past merger and acquisition decisions, which suggests that any future effect of Basel II on such decisions is also likely to be quite small.
Moreover, reductions in regulatory capital requirements for adopters relative to the requirements for non-adopters are unlikely to lead to an acceleration in the pace of consolidation. The second study evaluated the likely effect of Basel II on the competition between adopters and non-adopters in the market for small- and medium-sized business loans.