Since 2005, commercial banks have issued corresponding loans for equity mergers and acquisitions of PetroChina, Sinopec, CNOOC, Huaneng and Air China, that is, the so-called "one thing, one batch" system. The common mode of "one thing, one batch" system is that commercial banks first issue a conditional financing commitment letter, ask the regulatory authorities to confirm the compliance of equity financing business, and actually issue loans after approval. On June 29th, 2008, the State Council issued "Opinions on Policies and Measures to Support Wenchuan Earthquake Recovery and Reconstruction", which put forward a number of policies on post-disaster reconstruction, including "allowing banking financial institutions to carry out M&A loan business".
On June 3rd, 2008,65438+February 3rd, 2008, Article 5 of "Nine Articles on Financial Countries" deployed by the State Council clearly stated that "the financing channels of enterprises should be broadened through M&A loans and other forms".
2013165438+14 October, CBRC extended the term of M&A loan to a maximum of seven years to encourage the integration of a batch of production capacity through merger and reorganization.
At present, China's M&A financing system is still far from perfect. Laws and regulations such as the General Principles of Loans actually prohibit financial institutions from providing funds for M&A activities of equity transactions; There are also strict restrictions on the issuers of corporate bonds, and the issuance of bonds also has annual total control, interest rate level control and use restrictions; In terms of equity financing, China's public offering needs the approval of the issuance audit Committee of the China Securities Regulatory Commission, which is inefficient. Notice of China Banking Regulatory Commission on Printing and Distributing the Guidelines for Risk Management of M&A Loans of Commercial Banks
Banking Regulatory Bureau [2008] No.84, development banks, commercial banks and joint-stock commercial banks in various countries:
In order to standardize the bank's M&A loan behavior, improve the bank's M&A loan risk management ability, strengthen the banking industry's support for economic restructuring and optimal allocation of resources, maintain stable and rapid economic development, and promote industry integration and industrial upgrading, I will formulate the Guidelines for M&A loan risk management of commercial banks. The "Guidelines" are hereby printed and distributed to you, and the relevant matters are notified as follows:
1. A legal person institution of a commercial bank that meets the following conditions is allowed to carry out M&A loan business:
(1) Having sound risk management and effective internal control mechanism;
(2) The adequacy ratio of special provision for loan losses shall not be less than 100%.
(3) The capital adequacy ratio is not less than10%;
(4) The general reserve balance is not less than 65438+ 0% of the loan balance in the same period;
(5) Having a professional M&A loan due diligence and risk assessment team.
A commercial bank that meets the above conditions shall, before conducting M&A loan business, formulate corresponding M&A loan business process and internal control system according to the Guidelines for Risk Management of M&A Loans of Commercial Banks, and report them to the regulatory authorities for filing before implementation.
After starting M&A loan business, commercial banks should stop handling new M&A loan business if the above conditions cannot be met continuously.
Second, commercial banks should thoroughly implement the Scientific Outlook on Development, actively and steadily carry out M&A loan business according to the principles of legal compliance, prudent operation, controllable risks and sustainable business, and meet reasonable M&A financing needs on the basis of building a comprehensive risk management framework for M&A loans and effectively controlling loan risks.
Three. The dispatched offices of CBRC at all levels shall strengthen the supervision and management of M&A loan business of commercial banks, and regularly carry out on-site inspection and off-site supervision. If it is found that commercial banks do not meet the conditions for starting M&A loan business or violate the relevant provisions of the Guidelines on Risk Management of M&A Loan of Commercial Banks, they may take regulatory measures such as ordering commercial banks to suspend M&A loan business in accordance with relevant laws and regulations.
All banking regulatory bureaus are requested to forward this notice to city commercial banks, rural commercial banks, wholly foreign-owned banks and Sino-foreign joint venture banks within their jurisdiction.
December 6, 2008 Chapter I General Provisions Article 1 These Guidelines are formulated in accordance with the Banking Supervision Law of the People's Republic of China, the People's Republic of China (PRC) Commercial Bank Law and other laws and regulations in order to standardize the M&A loan business of commercial banks, improve the M&A loan risk management ability of commercial banks, promote fair competition in the banking industry, enhance competitiveness, and safeguard the legal and steady operation of the banking industry.
Article 2 The term "commercial banks" as mentioned in these Guidelines refers to the legal person institutions of commercial banks established in accordance with the Law of People's Republic of China (PRC) Municipality on Commercial Banks.
Article 3 The term M&A as mentioned in these Guidelines refers to the trading behavior of domestic acquirers to conduct mergers and acquisitions or actually control the target enterprises that have been established and continue to operate by transferring existing shares, subscribing for new shares, acquiring assets and assuming debts.
Mergers and acquisitions can be carried out by the acquirer through its wholly-owned or holding subsidiaries (hereinafter referred to as subsidiaries) with no other business activities.
Article 4 The term "M&A loan" as mentioned in these Guidelines refers to the loans issued by commercial banks to M&A parties or their subsidiaries to pay the transaction price of M&A..
Article 5 Commercial banks should follow the principles of compliance with laws and regulations, prudent operation, controllable risks and sustainable business when conducting M&A loan business.
Article 6 A commercial bank shall formulate the development strategy of M&A loan business, including but not limited to determining the development goal of M&A loan business, the customer scope of M&A loan business and its main risk characteristics, and the risk tolerance limit of M&A loan business.
Article 7 Commercial banks should establish corresponding M&A loan management systems and management information systems according to the principle that management intensity is higher than other loan types, so as to ensure that business processes, internal control systems and management information systems can effectively identify, measure, monitor and control the risks of M&A loans.
Chapter II Risk Assessment Article 8 Commercial banks shall assess the risks of M&A loans on the basis of comprehensive analysis of various risks related to M&A, such as strategic risks, legal compliance risks, integration risks, operational risks and financial risks.
If the M&A loan of a commercial bank involves cross-border transactions, it should also analyze the country risk, exchange rate risk and capital transfer risk.
Article 9 The strategic risk assessment of a commercial bank shall include but not be limited to the following aspects: the industry prospect, market structure, business strategy, management team, corporate culture and shareholder support of both parties to the merger:
(a) the industrial relevance and strategic relevance of both parties to the merger and acquisition, as well as the possible synergies;
(2) Opportunities for both parties to gain additional returns in terms of strategy, management, technology and market integration;
(three) the expected strategic effect after the merger and the source of power for the growth of enterprise value;
(four) the possibility of the new management team to achieve new strategic goals after the merger;
(5)M&A speculation and corresponding risk control countermeasures;
(6) Risk control measures or exit strategies that the acquirer may take when the synergy effect fails to be realized.
Article 10 A commercial bank shall assess legal and compliance risks, including but not limited to analyzing the following contents:
(a) whether the parties to the M&A transaction have the subject qualification of the M&A transaction;
(2) Whether the M&A transaction has been or will be approved in accordance with relevant regulations, and the necessary registration and announcement procedures have been fulfilled;
(3) Whether laws and regulations have restrictive provisions on the source of funds for M&A transactions;
(four) whether the legal structure of the guarantee is legal and effective, and whether the necessary legal procedures have been fulfilled;
(5) Whether the borrower's control over repayment cash flow is legal and compliant;
(6) Whether the lender's rights can be effectively guaranteed by law;
(7) Comply with other aspects related to M&A and M&A financing legal structure.
Article 11 A commercial bank shall assess the integration risk, including but not limited to analyzing whether both parties have the ability to achieve synergy through integration in the following aspects:
(1) development strategy integration;
(2) organizational integration;
(3) asset integration;
(4) business integration;
(5) Integration of human resources and culture.
Article 12 A commercial bank shall assess its operational and financial risks, including but not limited to analyzing the following contents:
(a) the main risks of enterprise management after the merger, such as whether the industry development and market share can remain stable or show a growing trend, whether corporate governance is effective, whether the management team is stable and has sufficient capacity, whether the technology is mature and can improve the competitiveness of enterprises, and whether financial management is effective;
(2) The future cash flow of both parties and its stability;
(3) The risk that the acquired equity (or assets) is priced higher than the reasonable valuation of the equity (or assets) of the target enterprise.
(4) Dividend strategies of both parties to the merger and acquisition and their influence on the source of M&A loan repayment;
(5) Fixed-income instruments used in M&A and their influence on M&A loan repayment sources;
(VI) The influence of exchange rate and interest rate changes on the repayment sources of M&A loans.
Article 13 A commercial bank shall, on the basis of comprehensive analysis of various risks related to M&A, establish a prudent financial model, calculate the future financial data of both M&A parties, and the key financial leverage and solvency indicators that have an important impact on M&A loan risks.
Article 14 Commercial banks should fully consider the influence of various unfavorable conditions on M&A loan risk on the basis of financial model calculation.
The above disadvantages include but are not limited to:
(1) The operating performance (including cash flow) of both parties failed to remain stable or showed an upward trend during the repayment period;
(2) The governance structure of both parties to the merger is imperfect, and the management team is unstable or incompetent;
(three) after the merger, the merger and acquisition and the target enterprise failed to produce synergy;
(4) There is a relationship between the acquirer and the target enterprise, especially when the acquirer and the target enterprise are controlled by the same actual controller.
Article 15 A commercial bank should comprehensively judge whether the borrower's repayment source is sufficient, whether the repayment source matches the repayment plan, and whether the borrower can pay the loan principal and interest as agreed in the contract on the basis of a comprehensive evaluation of the M&A loan risk, put forward countermeasures or exit strategies that can be taken when the quality of the M&A loan declines, and form a loan review report.
Chapter III Risk Management Article 16 The balance of all M&A loans of a commercial bank shall not exceed 50% of the bank's net core capital in the same period.
Article 17 A commercial bank shall, according to the development strategy of M&A loan business, establish a corresponding concentration limit control system for individual borrowers, enterprise groups and industry categories of M&A loans.
The M&A loan balance of a commercial bank to the same borrower shall not exceed 5% of the bank's net core capital in the same period.
Article 18 The proportion of M&A loans in the sources of M&A funds shall not be higher than 50%.
Article 19 The term of M&A loans shall generally not exceed 5 years.
Article 20 A commercial bank should have a sufficient number of professionals who are familiar with M&A-related laws, finance, industry and other knowledge, commensurate with the scale and complexity of its M&A loan business.
Article 21 Commercial banks should strengthen professional management and control in major business links such as M&A loan business acceptance, due diligence, risk assessment, contract signing, loan issuance, post-loan management and internal control system.
Article 22 An M&A loan application accepted by a commercial bank shall meet the following basic conditions:
(1) The acquirer operates in compliance with the law, has a good credit status, and has no bad records such as credit default and evasion of bank debts;
(2) Whether M&A transactions are legal and compliant involves national industrial policies, industry access, antitrust, transfer of state-owned assets, etc. Obtain approval from relevant parties and perform relevant procedures in accordance with applicable laws, regulations and policies;
(3) There is a high industrial or strategic correlation between the acquirer and the target enterprise. The acquirer can acquire strategic resources such as R&D capability, key technologies and processes, trademarks, franchising, supply or distribution network of the target enterprise through mergers and acquisitions, and improve its core competitiveness.
Article 23 A commercial bank shall organize a special M&A loan due diligence and risk assessment team to investigate, analyze and evaluate the contents of Articles 9 to 15 of these Guidelines, and form a written report.
The person in charge of the special group mentioned in the preceding paragraph shall have more than 3 years of M&A experience, and its members may include but not limited to M&A experts, credit experts, industry experts, legal experts and financial experts.
Article 24 Commercial banks may, according to the complexity, professionalism and technicality of M&A transactions, employ intermediaries to conduct relevant investigations, and use the investigation reports of intermediaries in risk assessment.
In case of any of the circumstances listed in the preceding paragraph, a commercial bank shall establish a corresponding management system for intermediaries, and clarify the legal responsibilities of intermediaries through written contracts.
Article 25 A commercial bank shall require the borrower to provide guarantees sufficient to cover the risks of M&A loans, including but not limited to asset mortgage, equity pledge, third-party guarantee and other forms of guarantee that meet the legal requirements.
In principle, commercial banks should require higher guarantee conditions for M&A loans than other types of loans. When commercial banks pledge the equity of the target enterprise, they should adopt a more prudent method to evaluate its equity value and determine the pledge rate.
Article 26 A commercial bank shall, according to the risk assessment results of M&A loans, carefully determine the contents of basic clauses such as loan amount, term, interest rate, installment repayment plan and guarantee method in the loan contract.
Article 27 A commercial bank shall stipulate key clauses in the loan contract to protect the interests of the lender, including but not limited to:
(a) binding provisions on the important financial indicators of the borrower or the enterprise after the merger;
(2) Mandatory provisions for prepayment of the extra cash flow obtained by the borrower under certain circumstances;
(3) Monitoring clauses on the main account or special account of the borrower or the enterprise after the merger;
(4) The commitment clauses of the borrower to guarantee the lender's right to know or recognize major issues.
Article 28 A commercial bank shall, through the key clauses mentioned in Article 27 of these Guidelines, agree on the risk control measures that both parties can take under the following circumstances:
(1) Changes of important shareholders;
(2) Changes in major investment projects;
(3) Abnormal changes in operating costs;
(4) Major adverse changes have taken place in the brand, customers and market channels. ;
(five) to generate new major debts or external guarantees;
(six) the sale of major assets;
(seven) major changes in the dividend strategy;
(eight) other major issues affecting the continuing operation of the enterprise.
Article 29 A commercial bank shall stipulate in the loan contract the withdrawal conditions and terms related to the payment and use of the loan, and the withdrawal conditions shall at least include that the self-raised funds of the acquirer are fully in place and the merger compliance conditions are met.
Article 30 A commercial bank shall stipulate in the loan contract that the borrower is obliged to submit the financial statements of the purchaser and guarantor and other relevant materials required by the lender on a regular basis during the loan period.
Article 31 A commercial bank shall regularly assess the predictability and stability of future cash flows of both parties during the loan period, and regularly assess whether the borrower's repayment plan matches the repayment source.
Article 32 Commercial banks should pay attention to the performance of key clauses in loan contracts during the loan period.
Article 33 A commercial bank shall classify the risks of M&A loans, and make provision according to the frequency and standard not lower than other types of loans.
Article 34 For M&A non-performing loans, commercial banks should take timely risk control measures such as loan collection and preservation, disposal of collateral, and taking over the management right of enterprises according to law.
Article 35 A commercial bank shall specify the contents, channels and frequency of internal reports on M&A loan business, conduct internal inspection and independent internal audit on the compliance and asset value changes of M&A loan business at least once a year, and comprehensively evaluate its risk status.
When the concentration of M&A loans tends to be higher and the risk classification tends to be lower, commercial banks should increase the frequency of internal reporting, inspection and evaluation.
Article 36 When the NPL ratio of M&A loans rises, commercial banks should strengthen the reporting, inspection and evaluation of the following contents:
(1) The way and composition of M&A loan guarantee and the coverage of loan principal and interest;
(2) Measures for collection and preservation of non-performing loans;
(3) Disposal of pledged equity.
(four) the situation of taking over the management right of the enterprise according to law;
(5) Write off bad debts of M&A loans.
Chapter IV Supplementary Provisions Article 37 The acquirer and the acquiree mentioned in these Guidelines refer to the acquirer and the target enterprise.
Article 38 The China Banking Regulatory Commission shall be responsible for the interpretation of these Guidelines.
Article 39 These Guidelines shall come into force as of the date of promulgation.