Analysis On The Synergistic Effect Of M&A Between Bank And Insurance

In 2008,the policy of equity investment between commercial banks and insurance companies was relaxed by financial supervision;in March 2018,the institutional reform proposal for the formation of the”Bank of China Insurance Regulatory Commission” proposed by the State Council was reviewed and passed,and both conformed to the current financial industry in China.The development trend of mixed operation has promoted the bank's mixed business process.Banking mixed operations not only helps to increase the flexibility of its operations,but also reduces its systematic financial risks.Therefore,as a development trend of the financial industry,the mixed operation is necessary to carry out research with guiding significance.As a typical example of mixed-industry operations,the M&A of bank-insurance seems to be more meaningful for the research on the synergy effects of M&A.Based on the synergy theory and evaluation methods of M&A,this paper first briefly analyzes the status of the development of M&A at home and abroad,and combines the event study and the accounting analysis method to research the synergy between China Agricultural Bank's acquisition of Jiahe Life Insurance.Research findings: From the short-term,the impact of the M&A announcement on the market is significant,but the excess return rate is negative,indicating that the shareholders of the Agricultural Bank has brought losses.In the long run,in terms of the analysis of the synergies of operations,management,and finance,the financial indicators of M&A parties are mostly positive.This indicates that the bank-insurance of M&A has achieved a certain degree of synergy.Finally,this paper puts forward suggestions for each party involved in M&A:investors should weigh the short-term and long-term effects of bank-insurance in M&A;commercial bank management should improve the efficiency and success rate of bank-insurance in M&A;insurance companies should be clear about their positioning,Weighing M&A projects carefully;regulators should improve policiesand regulations and strengthen the standardization of bank-insurance in M&A.