Japan's big 3 banks to decide on broker bid

Source: Agencies | February 12, 2009, Thursday |

Print Edition

JAPAN'S three largest banks will tell Citigroup Inc this week whether they want to bid for the company's Tokyo-based brokerage unit, local media reported yesterday.

Mitsubishi UFJ Financial Group Inc, Mizuho Financial Group Inc and Sumitomo Mitsui Financial Group Inc are likely to compete for Nikko Cordial Securities Inc, which an ailing Citigroup is expected to shed as part of a global restructuring.

The three "megabanks" could signal their interest within the week, said the Yomiuri Shimbun daily.

After reporting a quarterly loss of US$8.29 billion, Citigroup last month reorganized into two entities, Citicorp and Citi Holdings. The first is focused on traditional banking around the world, while the second holds the company's riskier assets and tougher-to-manage non-core ventures, including Nikko Cordial.

Analysts have said CEO Vikram Pandit's move allows Citigroup to sell or spin off the Citi Holdings assets to raise cash.

Citigroup has begun scaling back its presence in Japan to cope with the global financial crisis. In December, it agreed to sell NikkoCiti Trust and Banking Corp to Mitsubishi UFJ Trust and Banking Corp worth 25 billion yen. Nikko Cordial, which Citigroup acquired just a year ago, is Japan's No. 3 brokerage with managed assets of 25 billion yen (US$276.7 million).

Finance

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Japan's big 3 banks to decide on broker bid

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