Economics & Finance / Finance & Investment / Banking & Credit

Bank Mergers Just Made Your Mortgage More Expensive? The Shocking Truth from Canada

The Effect of Mergers in Search Markets: Evidence from the Canadian Mortgage Industry

Think bank mergers only affect competition? Think again. In Canada's mortgage market, where rates are negotiated, a major merger didn't just raise average rates by 6 basis points—it hit savvy borrowers the hardest while leaving the least informed untouched. This video breaks down the research by NBER economists, revealing how search costs and bargaining power determine who pays more. You'll learn why traditional antitrust policies fail the most vulnerable, and what actually works to help borrowers get a fair deal. Based on the working paper 'The Effect of Mergers in Search Markets: Evidence from the Canadian Mortgage Industry' by leading economists.