China’s National Financial Regulatory Administration has released draft regulations to expand and ease bank lending for mergers and acquisitions (M&A), marking the first time bank loans can support minority equity deals. The new rules split M&A into two categories: “control acquisitions,” where buyers take majority stakes, and “equity acquisitions,” for minority stakes of at least 20%.
Under the draft, banks can lend up to 70% of the deal value for control acquisitions with loan terms extended to 10 years from the previous 7 years. For equity acquisitions, loans can cover up to 60% with a maximum 7-year term. Banks must meet asset thresholds—CNY 50 billion (~$7 billion) for control acquisition loans and CNY 100 billion (~$14 billion) for equity acquisition loans.
With over 3,500 M&A deals completed in China in the first half of 2025, totaling nearly CNY 800 billion (~$111 billion), the expanded loan scope aims to further support corporate restructuring and investment diversity.
