M & A Wave Of Bank Strategic Choice

It has been more than one hundred years since the appearance of M&A. In history, there had been five M&A tidal waves in large scale. Bank M&A is a principal part of M&A. In the five tidal waves, banking is also the participator. For instance, Germany banking realized the concentration through M&A in the first tidal wave. From 1873 to 1879, the Deutsch Bank mergered 36 banks. In the following years(1901-1906), it mergered 26 banks again. By the First War, it had mergered and acquired 87 banks as the most capital adequate bank in Europe.With the economic globalization and financial deregulation, a new wave of bank mergers and acquisitions (M&A) during which a couple of mega-sized banks formed have been surging throughout the world, making some impacts on the world' s financial structure especially the financial industries in developing countries. After China' s entry into WTO, the domestic financial industry is faced with more severe challengers as well as unprecedented opportunities. China will gradually lift the various restrictions on foreign financial institutions; therefore the bank M&A worldwide will inevitably affect the domestic financial industry. Under this circumstance, one of the effective approaches to strengthen the domestic financial industry is to seek scale economy effect and scope economy effect through bank M&A, enhancing its capabilities of contending with multinational banks.China' s financial industry is now in the crucial time when the system is being transferred. Choosing a rational strategy is a key question. This paper verifies that bank M&A is not a omnipotence choice. Constituting the characteristic strategy can make bank outstand in the ardent competition. Strategy coalition and dummy bank can rush the mini-sized restriction, as well as avoid the conformity risk after M&A.This paper is convictive through utilizing comparative analysis method and illustration method.