The Research On Merger And Acquisition Of City Commercial Bank Under The Background Of Financial Disintermediation

In China，compared with the state-owned Banks and joint-stock Banks，Citycommercial Banks still have many defects and deficiencies due to congenital deficiency，such as unbalanced regional development、inadequate capital、small asset size、imperfectcorporate governance structure. Following the open of Chinese banking industry in2006,foreign financial institutions that have certain advantages in financial strength, technologylevel, management level and so on will aggressively enter into Chinese financial market,this will no doubt that it will influence the development of city commercial Banks. Citycommercial Banks, as a weak group of the banking industry, must reshuffle to enhancetheir competitiveness, and get a place in the fierce competition after the fully open of thebanking industry.Because of rising financial disintermediation and the limitations of our small andmedium-sized commercial Banks, the real problem we have to face is mergers andacquisitions following the general rules of marketization studies of bank’s mergers andacquisitions abroad is rich and enough, while the research on practices and theories in thisfield has just been started and need to deepen and further the relevant studies, which couldprovide guidance on the upcoming bank mergers and acquisitions activities.Since Industrial Bank mergers Foshan city commercial bank and bank of Weishang in2004, the examples of mergers and acquisitions of city commercial bank is not usual.However, following the rising of the current financial disintermediation degree and citycommercial Banks’ limitations, mergers and acquisitions will inevitably come. As theempirical research on this aspect is limited in China, how to gain an effective citycommercial bank m&a has not been solved properly. At present, the background of the citycommercial Banks is almost equal to the situations of America in the90s. Under thiscircumstances, based on the experience of American banking mergers and acquisitions, thispaper analyze the trend of reorganization of city commercial Banks from the perspective offinancial disintermediation, which has strong practical significance.