Mainly to avoid risks while implementing a stable business strategy and reasonable institutional layout

There is essentially no difference between the two. Jinshang Bank is a reorganization of a commercial bank

I will give you a very detailed article, you will understand after reading it

From all walks of life in Shanxi calling for the establishment of Shanxi Merchant Bank in 2005, to 2006 when it was listed as a priority of the Shanxi Provincial Government. Now that the listing has been completed, Shanxi Bank Commercial Bank has had many twists and turns along the way.

Possible Ways

The predecessor of Jinshang Bank - Taiyuan Commercial Bank (hereinafter referred to as Taiyuan Commercial Bank) was established in October 1998 and was restructured from 56 original urban credit cooperatives. , is the largest city commercial bank in Shanxi Province.

According to the asset liquidation and capital verification report issued by Shenzhen Rongxin Accounting Firm, before the reorganization and name change of Jinshang Bank, as of the end of 2007, the net assets of Taiyuan Commercial Bank were -1.973 billion yuan and non-performing assets were 3.635 billion yuan, of which Non-performing loans were 3.141 billion yuan, and non-credit non-performing assets were 494 million yuan.

Because Tai Commercial Bank has not replenished new capital for a long time, risk provision withdrawals and capital adequacy ratios are seriously insufficient, and structural operating risks have emerged. This situation has attracted great attention from the Shanxi Provincial Government and Taiyuan Municipal Government.

Beginning in 2005, all walks of life in Shanxi began to call for the establishment of Shanxi Merchants Bank.

To this end, the Shanxi Provincial Banking Regulatory Bureau, with the original intention of resolving financial risks and increasing local financial support, has conducted multiple investigations on the restructuring and reform of local commercial banks.

The survey believes that with the adjustment of the business strategies and institutional layout of state-owned commercial banks and joint-stock commercial banks in the province, the ratio of deposits and loans is generally low. At the same time, loans are obviously clustered in big cities and large enterprises. Due to the current situation, the financial needs of enterprises in most areas of Shanxi Province, especially small and medium-sized enterprises and private enterprises, are difficult to effectively meet.

At the same time, the risk problems existing in Taishang Bank are affected by historical conditions and restricted by its own scale. Its ability to resist and resolve risks is limited, and it cannot effectively resolve them by relying on its own strength alone. Shanxi Banking Regulatory Bureau’s research believes that through the establishment of Shanxi Commercial Bank, it is a feasible way to resolve and deal with risks in development.

Twists and turns

The reorganization process can be said to have been full of twists and turns.

In the second half of 2006, the Shanxi Banking Regulatory Bureau drew on the ideas of Huishang Bank and conducted a thorough investigation of four city commercial banks in Taiyuan, Datong, Changzhi and Jincheng and two city credit cooperatives in Yangquan and Jinzhong. And proposed a joint reorganization plan.

In 2007, this idea was written into the local government work report. The report of that year clearly stated that "integrate local financial resources and explore the establishment of Shanxi Merchants Bank".

As the formation progressed, the provincial and municipal governments and the Shanxi Banking Regulatory Bureau found that the joint reorganization plan of combining six city commercial banks and city credit cooperatives was not realistic. The biggest problem is the diversification of interests and high coordination costs.

At this time, should we insist on joint reorganization? Or should we insist on independent reform of Tai Commercial Bank? The final balance chose the latter.

On August 6, 2008, the Shanxi Provincial Government formally established a leading group and preparatory group for Jinshang Bank. On September 5, the provincial government held a working meeting of the leading group and preparatory group for the establishment of Jinshang Bank. The meeting reviewed and approved the "Work Plan for the Establishment of Jinshang Bank in Shanxi Province" submitted by the Shanxi Banking Regulatory Bureau.

Subsequently from October to December, the preparatory team of Jinshang Bank held four intensive working meetings. In accordance with the requirements and arrangements of the "Work Plan for the Establishment of Jinshang Bank in Shanxi Province", Taiyuan Commercial Bank carried out Capital increase and share expansion and disposal of non-performing assets.

On December 31, 2008, the China Banking Regulatory Commission issued the "Reply on the Name Change of Taiyuan Commercial Bank", which approved the renaming of Taiyuan Commercial Bank Co., Ltd. to "Jinshang Bank Co., Ltd."

Liquidation and reorganization

How to transform a city commercial bank into a joint-stock commercial bank that fully meets the standards. Liquidation and capital verification and asset restructuring are the two most difficult bones to crack.

In the last three months of 2008, Tai Commercial Bank implemented the above reforms as quickly as possible.

According to the resolution of the Taiyuan City Commercial Bank’s extraordinary general meeting of shareholders, the provincial government, the municipal government and the original legal person shareholders respectively contributed funds to dispose of Taiyuan City Commercial Bank’s existing non-performing assets of 3.393 billion yuan, including those sold to financial companies. Non-performing assets are 2.401 billion yuan; existing non-performing loans are 498 million yuan; non-credit non-credit assets are 277 million yuan; and non-credit non-credit assets accumulated over the years are 217 million yuan.

The sources of disposal funds include: the provincial government’s monetary capital investment of 920 million yuan, the municipal government’s investment of 601 million yuan, the premium of new legal person shares of 1.046 billion yuan, and the proceeds from the transfer of shares by the original legal person shareholders of Taiyuan Commercial Bank to new investors of 0.7501 billion yuan Yuan et al.

At the same time as the replacement and disposal of non-performing assets, Taishang Bank intensively increased its capital and shares.

After the share reform, Taishang Bank’s registered capital increased from 605 million yuan to 3.2 billion yuan. The total equity after raising was 2.391 billion yuan, of which 1.787 billion yuan was added in equity.

The new capital structure after fundraising is: Shanxi Provincial Government invested 480 million yuan to subscribe for 480 million additional shares, accounting for 20.07%, and Taiyuan Municipal Government retained 320 million shares of the original capital, accounting for 13.38%; According to the ratio of 1:1.8, the new legal person shareholders absorbed an investment of 2.352 billion yuan and subscribed for 1.307 billion new shares, accounting for 54.64%. Among them, the premium investment part of 1.046 billion yuan was used to absorb the losses of non-performing assets and was transferred to the Taiyuan Municipal Government. And the shares held by the original legal person shareholders are 153 million shares, accounting for 6.42%; the legal person share capital of the original Taiyuan City Commercial Bank is retained at 052.10 million shares, accounting for 2.18%; the natural person share capital of the original Taiyuan City Commercial Bank is retained at 079.44 million shares, accounting for 3.32%.

Among the new legal person shareholders, famous companies such as Taiyuan Iron and Steel and Shanxi Coking Coal are on the list.