2 Central Japan Regional Banks Announce Oct. 2022 Integration

Economy

Nagoya, Dec. 10 (Jiji Press)--Aichi Bank <8527> and Chukyo Bank <8530>, both operating mainly in Aichi Prefecture, central Japan, said Friday that they have reached a basic agreement to set up a joint holding company in October 2022 for business integration.

After the start of the business integration scheme, the second-tier regional banks will operate under the holding company and merge into a single bank around 2024.

They aim to strengthen their management foundations by expanding operations and promoting business efficiency at the same time to survive a continuing tough business environment marked by superlow domestic interest rates and intensifying competition for loan customers.

Aichi Bank and Chukyo Bank had a combined 4,174.7 billion yen in outstanding loans as of the end of September, more than 3,225.5 billion yen at Bank of Nagoya <8522>, also a second-tier regional bank in Aichi. All three banks have their headquarters in Nagoya, the capital of Aichi, and are listed on the first section of the Tokyo Stock Exchange.

There are many major companies in Aichi, such as those in the automobile sector, and competition among banks in Aichi and nearby prefectures, including MUFG Bank, which has taken over the business resources of Tokai Bank, a now-defunct Nagoya-based lender, and regional and shinkin banks, is therefore fierce.

[Copyright The Jiji Press, Ltd.]

Jiji Press