Cibc Mellon Essay

354 Words2 Pages
This article explains the development history of CIBC Mellon (JV), why CIBC Mellon had been so successful, the difference between Canadian and U.S. financial sectors. What’s more, the article’s conclusion also clarifies the challenge of refining the future direction of the joint venture and the challenge of avoiding major operational missteps. My favourite part of this essay is the speech from MacMillan in November 2006 to the Financial Services Institute. He concluded the following reasons: The original business plan made sense; the parents receive benefit from the JV itself in the form of dividends but also from outside of the JV; both parents cooperate; commitment of the parents; the JV has effectively leveraged the strength of both parents; good management and lucky. On one hand, because CIBC approached several potential partners, but it was Mellon’s technology and people that impress it the most. CIBC had a Canadian presence and a client base, but it lack technology and its service was average. On the other hand, Mellon had great technology, products and services, but no presence in Canada and few clients in the country. Their advantages and disadvantages determined that the two parents would cooperate. Both parties needed each other and there was very little overlap, which makes them both successful. Before they cooperated, it should be highly emphasized that both sides should recognize their own resources, capabilities and competitiveness, which is the most important step of joint ventures. Apart from recognizing their internal advantages and disadvantages, what they should both pay attention is the external elements. As the article mentioned, discrepancies in consumer debt and equity levels, divergent banking regulations and differences in the structure of each country’s mortgage security industry comprised some of the most significant concerns. In

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