Regional Bank in Yamagata Pref. to Mull Seeking Public Funds

Economy

Tokyo, May 13 (Jiji Press)--Kirayaka Bank, a regional lender operating mainly in the northeastern Japan prefecture of Yamagata, and its parent, Jimoto Holdings Inc. <7161>, said Friday that the group will start considering applying for an injection of public funds from the Japanese government.

The regional bank group will aim to strengthen its financial base by utilizing a special program under the revised financial function reinforcement law, designed to support small businesses hit by the fallout of the novel coronavirus pandemic.

The group is expected to seek about 20 billion yen in public funds, or taxpayer money, informed sources said. Detailed talks on the matter will be held within the group later.

It would be the first case of public fund injection into a regional bank since Howa Bank <8559>, whose main service area is the southwestern prefecture of Oita, received such funds in 2014.

Kirayaka Bank received public funds in 2009, after the September 2008 collapse of U.S. investment bank Lehman Brothers, and in 2012, after the March 2011 earthquake and tsunami in northeastern Japan, with the combined injection amount totaling 30 billion yen.

[Copyright The Jiji Press, Ltd.]

Jiji Press