By Eliot Hugh MacDonald

Recent merger proposals among major Canadian banks have required that the government, for the first time, review mergers of such size, complexity and impact on society.  The government's Competition Bureau recently developed a process for reviewing bank mergers in terms of competition law violations, the results of which have a major impact on the success of bank merger proposals.  Defining geographic markets and calculating market share represent important components of this process, bringing to the forefront an application for geographic information systems (GIS) which is not widely recognized.  In this report a set of GIS-based methodologies that can be used by banks to perform a competition law-related self-review process is proposed.  Creation of the appropriate geographic boundaries and spatially oriented modeling techniques for estimating market share are explored.  Relevant spatial information, backed by large volumes of customer data from a subject financial institution, is also developed to support various viewpoints.