Additional mergers in the banking sector remain doubtful despite the announcement on Monday that Bank of Queensland (BOQ) is in discussions with Bendigo Bank.

According to an analyst report from Goldman Sachs JBWere, the probability of any further consolidation is low, although overseas institutions looking to make a greater impact on the Australian market could still be forced into a move.

"The dark horses in our view remain HBOS and GE (General Electric's banking arm) with both banks clearly trying to grow in Australia," the Goldman Sachs JBWere analysts report said.

"Given GE is still missing a full banking licence, we believe that it remains a likely acquirer, but again it would be more likely to be a competition bid for a small regional rather than a major.

"As the pool of available banks shrinks, these companies may be compelled to act now to ensure they don't miss out."

The proposed merger consideration is 0.748 BOQ shares plus $5.50 cash for each Bendigo share. Based on Friday's close of $16.60 for BOQ shares, that values the offer at $17.92 a Bendigo share, and represents a premium of 36 per cent to Friday's closing price.

BOQ apparently informed Bendigo would require the unequivocal support of the Bendigo board of directors to proceed, while BOQ shareholders will own about 60 per cent of the merged company.

"BOQ's attempted takeover of Bendigo likely does not represent the beginning of another round of consolidation but rather one strategically challenged sub-scale organisation, albeit well managed (ie BOQ), bidding for another strategically challenged sub-scale organisation (ie Bendigo)," said a JPMorgan analysts report.