Japan’s SBI Holdings acquires 17.9 pct stake in Fukushima Bank

SBI holdingsJapanese internet banking giant SBI Holdings Inc and Fukushima Bank Ltd announced on Monday that they will form capital and strategic tie-up, with SBI taking a 17.91% stake in the domestic lender.

Fukushima Bank will issue new shares to SBI for 222 yen each for a total investment of 1.11 billion yen ($10.19 million), in a deal which will make it the biggest shareholder in the lender. Post the deal, SBI will hold about 20 per cent stake in the lender.

The two companies will jointly establish offices where SBI’s products such as investment trust and insurance are provided to Fukushima Bank’s customers, while the companies will also develop new fintech-focused services, they added. SBI will also appoint an official to serve on the bank’s board, according to media reports.

In September, SBI had announced an investment of 2.5 billion yen in another regional lender Shimane Bank.

Established in 1922, Fukushima Bank posted a group net loss of 3.12 billion yen in the fiscal year ended in March last year, falling into the red for the first time in seven years. Japan’s Financial Services Agency had ordered the bank to improve its business operations.

Regional banks in Japan have been affected by a decline in the domestic population, with many of them merging operations. On the other hand, SBI has been expanding its operations by striking alliances with banks in an effort to become the country’s fourth mega-bank.

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