Study Of Commercial Bank M & A Loan Regulatory Legal Issues

The M&A loans of Commercial bank is the cash that commercial bank provides for the payment of mergers and acquisitions. The boom of M&A market gave birth to M&A loans. On the one hand it promoted the development of M&A transactions; on the other hand, it brings a new profit point to commercial banks. The M&A loans stem from the United States and other more developed countries and has more common market. But in China, considering slashes the risk of banks, M&A loan business is prohibited in principle. Until Chinese Banking Regulation Committee issued " guideline of risk management of commercial banks M&A loans " in year of 2008, the M&A loan business has really developed.Commercial bank launched M&A loans in China for only one year or more, the vast majority of commercial bank lack of experience of M&A loans. On the aspects of M&A loan review, risk assessment, loan contract designing, and post-loan management, our commercial banks are still relatively unfamiliar. For that the M&A loan practice is complicated, involving a wide range of knowledge and high risk, in the initial stage of M&A loan business, the commercial banks cannot effectively assess their risk and control because of the lack of practical experience which leads to the increase of non-performing assets and commercial banks'operating risks. Therefore, effective regulatory system should be designed to strengthen the supervision of M&A loans and prevent the emergence of risk.The first part of the dissertation discusses the concept and content of M & A loans and tries to define the argument for the acquisition of loans from the nature of M&A. It also outlines common types and forms of M&A in the international banking market, with the purpose of making the supervision targets and scope of M&A clear.Then, based on the study of the nature of M&A loans, the author analysis the characteristics of the M&A loans and discussed the specific risks of M&A according to its usage and features, which including the strategic integration risk in M&A transaction, the qualifications risk of acquisition entity, the processing risk in transaction, anti-trust risks and the risks arising from the method and structure of mergers and acquisitions transaction. Based on study of the basic elements of M&A loans above, the second part of the dissertation mainly focus on the theoretical issues about the regulation of M&A loans. So the risk structure of M&A loans is researched separately and we get the conclusion that the risks are bundled in the secondary market and a security risk is transferred to the target company with the feature of significant legal risk and integration of risk. Next, from the view of negative externalities, asymmetric information as well as moral hazard of the Commercial Banks, the author demonstrated the necessity of monitoring M&A loans. Then effective supervision path of M&A is discussed in accordance with the analysis above.The third part discusses the current regulation on Commercial Bank M&A loans business, analyze the problems existing in the current regulation system and propose some effective measures according to the nature and characteristics of M & A loans and China's reality.