... effect of changes on the capital levels on performance hinges on the recent theory of the banking firm, which isbased on the ‘specialness’ of banks in a setting in which there are asymmetries of information. ... (1995), The role of capital in financialinstitutions, Journal of Banking and Finance 19, pp. 393-430.Berger, A. N. (1995), The relationship between capital and earnings in banking, Journal of Money, ... a variety of financial indicators to define the strategic features of banks engaged in domestic and cross-border mergers in the European Union. These indicators include measures of financial performance:...