Banking Market Consolidation and Tax Planning Intermediation: Evidence from Client Firm Tax Haven Operations

Jeong-Bon KIM*, Yupeng LIN, Ying MAO, Zheng WANG

*Corresponding author for this work

Research output: Journal PublicationsJournal Article (refereed)peer-review


This study examines the effect of banking market consolidations via mergers and acquisitions (M&As) on the role of banks in intermediating corporate tax planning through offshore tax haven operations. We find that bank clients significantly increase their tax haven operations after their banks are merged with others. In addition, such an increase is greater when a commercial bank merges with an investment bank and when the clients have greater tax planning opportunities. We also employ network analyses to show that the propensity for a client to expand its operations into a new tax haven country increases significantly when its relationship bank enters into this country through an M&A. Collectively, our findings reveal that bank M&As enhance banks’ tax intermediation capability.
Original languageEnglish
JournalThe Accounting Review
Publication statusE-pub ahead of print - 25 Oct 2022

Bibliographical note

We appreciate helpful comments from Lillian Mills (editor), two anonymous reviewers, Sati Bandyopahyay, Wenxia Ge, Tiemei Li, Sharon Katz, Duane Kennedy, Byron Song, Haibin Wu, Yangxin Yu, Liandong Zhang, and participants of research workshops at the City University of Hong Kong, Fudan University, Lingnan University, NUS Business School, Sun Yat-sen University, the University of Waterloo, and 42nd Annual Conference of the CAAA. Special thanks go to Anand Srinivasan, who shared the bank M&A data with us. Yupeng Lin acknowledges research support from the National University of Singapore and MOE Tier 1 Grant (Grant #: R-521-000-044-115). All errors are our own.


  • Tax haven
  • tax avoidance
  • banking market consolidation
  • tax planning intermediation


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