Japanese Banks Agree to Merge Into World’s Largest
TOKYO (AP) _ Two of Japan’s largest banks have agreed on a merger that would create the world’s biggest bank, top officials of the banks said today.
The combination of Mitsubishi Bank Ltd. and Bank of Tokyo Ltd. would create a banking company with $814 billion in assets.
That would surpass Japan’s Sumitomo Bank, which is currently the leader in assets with $601 billion.
Mitsubishi is strong in domestic commercial banking while Bank of Tokyo is strong in overseas operations and is Japan’s leading foreign currency bank.
``It’s a good combination,″ said Tsuneo Wakai, president of Mitsubishi Bank.
Bank of Tokyo president Tasaku Takagaki said Mitsubishi ``has a strong base that can fill out the places where we are lacking.″
Wakai said specific details of the merger must be worked out and discussions with banking authorities lay ahead. But he said the banks want to merge by April 1996.
The new bank will tentatively be called Tokyo Mitsubishi Bank, he said.
Japanese stock and bond prices had surged in late trading Tuesday after reports circulated that a deal ws imminent. The banks initially denied it.
The 225-stock Nikkei index climbed in the last hour to finish at 16,681.73, up 585.48 points, or 3.64 percent, from Monday’s close.
``These are two of the best Japanese banks,″ said Salomon Brothers banking analyst Alicia Ogawa, noting that neither bank has bad-debt problems of the magnitude that other top banks are facing.
If the merger goes through, the new bank would have deposits of $589 billion. Japan’s Sakura Bank, itself the product of a 1990 merger between Mitsui and Taiyo Kobe banks, is the current leader in deposits at $433 billion.