The Study On Cross-border Mergers And Acquisitions Of Chinese Commercial Banks

With financial globalization and liberalization, the world financial situation has undergone profound change; this is also a result of the financial crisis. The performance of different countries show different development trend. The countries where banking industry has good development have sought to boost their banks develop abroad, and implementation of cross-border mergers and acquisitions is becoming an important way of banks to expand overseas markets, overseas operations, and joint operations. After recent years of deepening reform, the comprehensive strength of Chinese commercial banks which also have a good performance in the financial crisis has been stronger. So the transnational operation is the inevitable choice. But because of the lateness of promoting international strategy, the cross-border mergers and acquisitions of Chinese commercial banks have been developing rapidly in recent years. With the absence of experience of mergers and acquisitions and the differences between their own operating system and the world, Chinese commercial banks’cross-border mergers and acquisitions, although made some achievements, but there are many problems. Therefore, Chinese banking industry should focus on the research of exploring their own right conditions for cross-border mergers and acquisitions.Based on the above considerations, this paper analyzes the following six parts:The first chapter introduces the research background and significance, the theories on motives, layout and effects of cross-border mergers and acquisitions at home and abroad. And then introduces the research methods and structural arrangements and paper the main innovation and inadequacies.The second part introduces the situation and existing problems of Chinese banks’cross-border mergers and acquisitions. The situation include the scale of cross-border mergers and acquisitions, layout situation, the way of mergers and acquisitions, characteristics of mergers and acquisitions.And we find that Chinese commercial banks’ cross-border mergers and acquisitions has begun to take shape, but compared with the advanced international banks they are still on primary stage; layout of cross-border acquisitions is relatively concentrated, mostly distributed in Hong Kong and Macao, and this is incompatible for the global development of multinational distribution layout; introduces three kinds of ways of cross-border mergers and acquisitions divided by payment. And the way of Chinese commercial banks’cross-border acquisitions mainly is cash-for-assets. Chinese commercial banks began to try other way to buy banks abroad such as stock-for-assets. And then the paper summed up problems of Chinese commercial banks’cross-border mergers and acquisitions.The third part describes Chinese commercial banks’cross-border mergers and acquisitions motivation. The motivation include the development of economic globalization and multinational corporations, following and serving their clients’ overseas investment, to seek a way to take advantage of their capital, learn and use of local advanced technology and experience, Chinese government’s support and encourage for the banks’cross-border mergers and acquisitions.The fourth part introduces effects of Chinese commercial banks’cross-border mergers and acquisitions from two aspects of micro and macro analysis. Microscopic aspects:improving Chinese commercial banks’transnational management level, combined with China ICBC’s earnings during the period2006-2012, asset quality and risk resilience case to illustrate the situation of banks’ management level conditions after cross-border mergers and acquisitions; breaking the barriers to entry, expanding the boundaries of their own business; achieve complementary advantages and obtain a synergistic effect; achieve high efficiency expansion and have access to economies of scale. Macro aspects:maintain the stability of our financial system; promote the rational flow of the stock of assets to achieve optimal allocation of resources in the financial sector; promote foreign trade and China’s sustainable economic development.The fifth part introduces the strategies for Chinese commercial banks’ cross-border mergers and acquisitions to be scientific and reasonable.Include: enhance its own development and improve the overall competitiveness of China’s commercial banks; flexibility to choose areas and target; gradual and steady advancement cross-border mergers and acquisitions; improve the level of overseas post-merger integration; strengthen risk prevention, and promote overseas acquisitions reasonably.Combined with the previous contents, the sixth part introduce Chinese commercial banks should come explore the characteristics suited to their own road of overseas mergers and acquisitions based on their own situation, and in the choice of acquisition targets they should try to mix business mergers and acquisitions and share benefit from outstanding foreign multinationals’ earnings.