Research On The Application Of Preference Shares In Commercial Banks

Preferred stock is a kind of innovative financing tool, which has a history of more than one hundred years of development in western countries. Preferred stock has been widely used in many industries because of its superior characteristics, and it has also played a positive role in perfecting and stabilizing the capital markets. However, due to various reasons, our country doesn’t put it to a good use for quite a long period of time, preferred stock once in a blank state. In 2014, with Shanghai Pudong Development Bank issued preferred stock issuance plan, the use of preferred stock in the banking industry gradually gets the attention of all parties. Then, the Bank of China, Agricultural Bank of China and so on each big commercial Banks have also tried to finance through the issuance of preferred stock. The overall train of thought of this article is as follows: First, comb the domestic and foreign research about preferred stock. Second, describe the motive of commercial banks for introducing preferred stock after the new policy issued, and mainly analyze the necessity and feasibility. Then, introduce the case of Shanghai Pudong Development Bank successfully issued preferred stock, the core terms, effect and it’s cause are analyzed emphatically. After that, put forward several proposals about the development of preferred stock in commercial banks. Finally, combined with the case analyzed in this paper, draw the conclusion and put forward my opinion about the future prospect of preferred stock in commercial banks in our country.Previously, due to the preferred stock has not been widely used in our country, the domestic scholar’s research mainly concentrated in the theory, the practice aspect discussion is less, especially the practice research about commercial banks. Since 2013, when new policy issued, preferred stock has been used in the banking industry for more than two years, the pros and cons have been gradually appeared. This paper takes the practical application of preferred stock of Shanghai Pudong Development Bank as the breakthrough point, to point with surface, explore the development prospect of preferred stock in domestic banking and the possible impact.