UFJ

Supranational entities have been here before, but MUFG is a landmark: the first renminbi sale by an arm of a proper, non-Chinese company.

But Japanese media reported that the bank was in talks with Bank of China, one of China's "Big Four" commercial lenders.

A spokesman for the Bank of Tokyo-Mitsubishi UFJ, said last week the bank would continue supporting Acom.

MUFG, Japan's largest financial group, said it had Y3, 300bn in debt securities of US government-backed mortgage finance companies.

Morgan Stanley also agreed this week to sell up to 20% of itself to Japan's largest bank, Mitsubishi UFJ.

Mitsubishi UFJ took a stake in Morgan Stanley and seized control of an American retail bank.

Mitsubishi Tokyo Financialpuorgwas a key decliner after forecast earnings downgrades as it absorbs UFJ's bad loans.

Bank of Tokyo-Mitsubishi UFJ and telecommunications providers KDDI are also planning to launch an Internet-only bank together.

Mitsubishi UFJ, a giant Japanese bank, will buy up to 20% of Morgan.

MUFG also cancelled its plan to acquire Nikko-Citi Trust & Banking after failing in its bid for Nikko Cordial.

Japanese banks also fair well in this year's ranking , with Mitsubishi UFJ taking back the top Asian bank spot from ICBC.

In turn, Mitsubishi UFJ will get a seat on Morgan Stanley's board and potential for future business tie-ups.

The sale is by the locally-incorporated subsidiary, rather than the Tokyo-based parent, and proceeds must stay within China.

Some have written to UFJ expressing concern at its decision to pursue a merger with MTFG before properly considering the rival offer.

Naomi Fink, Japan Strategist, Global Marketing & Trading Division, Bank of Tokyo-Mitsubishi UFJ, Ltd.

Bank of China Ltd. is the main underwriter of the deal, Bank of Tokyo-Mitsubishi UFJ (China) said.

And Mitsubishi UFJ Financial Group, a huge local bank, was slapped with sanctions for failing to prevent data theft by a fired employee.

That stake was diluted when Japan's Mitsubishi UFJ Financial Group Inc. (MTU) invested new funds in Morgan Stanley in October.

Morgan Stanley announced it was to sell a stake of 10-20 per cent to Mitsubishi UFJ in a deal worth $9bn.

Mr Nagayasu suggests MUFG would be keen to form further alliances or invest in overseas financial institutions.

'They'll do the deal, ' he told Mr. Mack, explaining that he knew MUFG's management from negotiating with them on a venture at Merrill.

The latest to weigh in on the debate is Christopher Rupkey, the New York-based chief financial economist at Bank of Tokyo-Mitsubishi UFJ.

CIC's stake was diluted after Morgan Stanley sold shares to Mitsubishi UFJ Financial Group last fall.

MUFG's Morgan Stanley investment adds further volatility to this mix.

UFJ's three outside directors are opposed to the MTFG merger while its four executive directors are in favour, according to bankers.

"Don't cry about the strong yen, fix the problem, " says Naomi Fink, strategist at Bank of Tokyo-Mitsubishi UFJ in Tokyo.

Mitsubishi UFJ, Japan's top lender, relies on Japanese companies for around 85-90 per cent of its China activity.

On Thursday Mitsubishi UFJ, Japan's biggest lender, plans to raise Rmb1bn ($146m) by selling two-year bonds to Chinese investors.

Understandably, MUFG has now reworked the terms.

More than 30 per cent of UFJ's shares are owned by non-Japanese institutional investors.

The original deal saw MUFG buying $6bn of preferred Morgan Stanley stock and $3bn of common shares.

Mitsubishi UFJ Financial Group said Monday it would raise as much as 990 billion yen, or $10. 7 billion, in capital.

MUFG has also imported a whole lot of volatility.

"It can't be helped, " said Akira Hoshino, chief manager of Bank of Tokyo-Mitsubishi UFJ's foreign exchange trading department.

Bankers say local securities houses Nomura and Daiwa are eager to expand, but banks such as Mitsubishi UFJ are less enthusiastic.

Shares of Japan's biggest bank, Mitsubishi UFJ Financial Group, declined 6. 8%.

Few outside Japan bother even to learn the names of Mitsubishi UFJ, Sumitomo Mitsui or Mizuho, Japan's three biggest banks.

Bank of Tokyo Mitsubishi UFJ Ltd.

MUFG's ability to keep the conversion price as high as $25. 25 a share represents a victory.

That is a highlight from a research report by Bank of Tokyo-Mitsubishi.

Mitsubishi UFJ held a portfolio of Japanese stocks valued at 6. 1 trillion yen, with unrealized gains of 1. 8 trillion yen, as of June.

KDDI, for example, is a Japanese telecom operator that has recently set up a bank along with Mitsubishi UFJ Financial Group.

For MUFG, meanwhile, this is a welcome new source of funding.

Mitsubishi UFJ Financial Group Inc. increased 3. 7 percent to 417 yen.

Sure, Morgan Stanley dividends will be equivalent to almost one-tenth of MUFG's earnings last year.

Another bank building a strategic toehold in Hong Kong is Bank of Tokyo-Mitsubishi UFJ Ltd.

In Japan, Mitsubishi UFJ Financial climbed 4. 2 per cent to Y617 ahead of its full-year earnings announcement.

Intermediary Bank: The Bank of Tokyo-Mitsubishi UFJ Ltd. , Tokyo

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