Research On Financial Risk Of Cross-border M&A Of Minsheng Bank

Through cross-border mergers and acquisitions,commercial banks can achieve substantial expansion growth.This developing method has risen late in China.Before China's commercial banks realized the importance of this method and gradually began to experiment,foreign banks in many developed countries have long carried out such mergers and acquisitions on a global scale.Therefore,with China's opening-up policy and the gradual development of the process of economic and political internationalization,China's commercial banks are no longer just facing domestic challenges,but also need to keep up with international trends to adapt to the intense international competition.As a result,China's commercial banking industry is gradually trying to conduct cross-border M&A activities.The most significant of these commercial activities are in 2006,from this year to the present,China's commercial banks really started the process of mergers and acquisitions.In2007,the financial chain reaction triggered by the subprime mortgage crisis had a very serious impact on the global economy.Banks led by the United States all suffered heavy losses during the financial crisis and encountered multiple difficulties in their operations.Thanks to national policies,regulation and supervision,the impact on China's economy is not very serious.The banking industry has also seized unprecedented opportunities in this global financial crisis.During this period,many banks in China sought self-rescue on the one hand,and on the other hand,in order to realize their own development strategies,they focused their attention on cross-border mergers and acquisitions and achieved a historic cross-border merger wave through various efforts.However,opportunities and risks often coexist.In the process of trying cross-border mergers and acquisitions,many banks failed to analyze the financial risks enough,which led to the emergence of the crisis.In the future,it is necessary to continue to develop the cross-border M&A activities of commercial banks in China.It is necessary to combine theories and reality to make a detailed analysis and pre-judgment to the risks,so as to take better measures to avoid.The research process in this paper are as follows.Firstly,based on the research and analysis of other researchers in the past,this paper makes a brief analysis of the current foreign economic development,and summarizes the relevant risk management theories involved in the research,which is used to support viewpoint;then,on this basis,The variousfinancial risks that China's commercial banks may encounter in the process of cross-border mergers and acquisitions and the reasons for these risks are elaborated.Then through a detailed case,The analysis material selected in this paper is a case of Minsheng Bank's merger and acquisition of United Bank of America.It describes the basic situation of the M&A activity and identifies the important financial risks that may exist in the M&A activity.According to the risk situation of the M&A activity,this paper establishes a financial risk evaluation system based on the COSO model,and actually uses the evaluation system to conduct a comprehensive evaluation result.Overall,the financial risk of the M&A activity is high.The financial risk,pricing risk,financing risk and payment risk of the M&A target,among which the pricing risk is the most prominent risk.According to the analysis results of Minsheng Bank's cross-border M&A case,this paper analyzes the reasons for these problems and proposes suggestions and opinions at the macro and micro levels.I hope that through the research in this paper,I can accumulate more deeper knowledge of risk identification related to cross-border M&A.I also hope that I can provide some reference for M&A activities of commercial banks in China,so that they can make effective risk identification and formulation.The corresponding preventive measures will achieve more development under international opportunities.