Riding the tide: Banks follow the trend

Nowhere has the tidal wave of mergers and acquisitions been stronger than in the banking industry. Some examples locally are First Union's buyout last year of CoreStates, Community Banks Inc.'s 1997 acquisition of Peoples State Bank, and more recently, Fulton Financial Corp.'s June acquisition of Ambassador Bank of the Commonwealth.

Thomas Theurkauf, a bank analyst who covers banks such as PNC Bank, Mellon Bank and First Union/CoreStates for Keefe Bruyette & Woods Inc., New York City, summed up the merger wave in six words: "Bigger is better and more efficient."

While Theurkauf is primarily familiar with the banking industry, his analysis applies to just about any …