Study On The Performance Of Industrial And Commercial Bank Of China’s Merger And Acquisition Of Tekstilbank In Turkey

With the gradual implementation of the national initiative of "One Belt and One Road" proposed by China,a large number of small and medium-sized financial institutions have sprung up like bamboo shoots after a spring rain.The competition in the domestic financial market is increasingly fierce under the impetus of many internal and external factors.On the other hand,the liberalization of interest rates has led to substantial decrease in the income of our country’s commercial banks whose main source of income is the interest rate difference between deposits and loans.In the face of the new market situation,under the guidance of the national "going out" strategy,China’s commercial banks have begun to expand overseas markets by means of cross-border mergers and acquisitions,in an attempt to cope with the increasingly fierce market competition and improve their own internationalization level.On the other hand,a large number of overseas commercial banks which are in crisis due to the impact of the economic situation are selling at lower asset prices,which is undoubtedly a good opportunity for Chinese commercial banks to acquire high-quality overseas targets.Therefore,it is of practical significance to study whether commercial banks can improve their performance by means of cross-border mergers and acquisitions,and to summarize successful experience that can be used for reference or failure lessons that need to be learned,so as to provide reasonable operation suggestions for the following international operation of Chinese commercial banks.China’s financial institutions are dominated by commercial banks,the Industrial and Commercial Bank of China,as the largest bank in the commercial banks,is undoubtedly the representative research object of China’s commercial banks in the cross-border M&A behavior.Compared with other competitors,it has obvious competitive advantages in terms of M&A costs,M&A scale and business scope.As an important part of China’s important international initiative of "One Belt,One Road",Turkey has a very important strategic position,and there is a big gap between Turkey and China in both economic and political aspects.As the acquired party of this research case,Turkey Tekstilbank occupies a dominant market position in Turkey.Therefore,it is of great significance to take this M&A case as the research object.In this thesis,event study method,financial index performance analysis method and factor analysis method are used to analyze the short-term price fluctuations of the stock market and the long-term performance after the M&A of ICBC.Firstly,the event study method is adopted to evaluate the short-term performance of shareholder value expressed by stock price,and evaluate the influence of this M&A event on the shareholder value of ICBC as the initiator of M&A in the short term.Then,in terms of long-term performance,the long-term performance of the acquisition is comprehensively evaluated by factor analysis,and then the financial indicators performance analysis method is used to make up the deficiencies.The research results show that,in general,the M&A of ICBC is a relatively successful attempt of cross-border M&A.In terms of short-term performance,the M&A event is undoubtedly a positive news for the market.In terms of long-term performance,although a number of financial indicators of ICBC performed poorly in the years following the merger due to the integration process of mergers and acquisitions.On the other hand,with the gradual completion of the integration work and the improvement of the external economic environment,the synergy effect of mergers and acquisitions has gradually emerged.Its profitability and capital guarantee ability have been effectively improved,and its capital scale has also increased significantly,which has brought about stronger growth capabilities.With ICBC’s excellent management ability,its advantages in resources and costs will be further expanded,and ICBC’s goal of building a global business network through cross-border mergers and acquisitions needs to be further realized After analyzing the M&A case of Industrial and Commercial Bank of China with various methods,this thesis puts forward corresponding suggestions from the perspective of government and commercial banks on the basis of drawing on advanced international experience and combining the experience and lessons of Industrial and Commercial Bank of China in the M&A process.This thesis hopes that China’s commercial banks can make a correct choice under the premise of national policy support,so as to improve the internationalization level of China’s financial industry.