Legal analysis: In order to standardize the M&A loan operation behavior of commercial banks, improve the M&A loan risk management ability of commercial banks, strengthen commercial banks' support for economic restructuring and optimal allocation of resources, promote fair competition in the banking industry, and safeguard the legal and steady operation of the banking industry, these guidelines are formulated in accordance with the Banking Supervision Law of the People's Republic of China and the Law of People's Republic of China (PRC) on Commercial Banks.

Legal basis: Article 3 of the Guidelines for the Risk Management of M&A Loans of Commercial Banks M&A refers to the transaction behavior that domestic M&A enterprises merge or actually control the established and continuing target enterprises or assets by transferring existing shares, subscribing for new shares or 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.