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Taiwanese lender Chinatrust set to acquire Tokyo Star Bank

Kyodo

Chinatrust Commercial Bank of Taiwan has basically agreed with the main shareholders of Tokyo Star Bank to acquire it, becoming the first foreign lender to buy a Japanese bank, sources said Thursday.

The Taiwanese bank and the shareholders will hammer out the details of the acquisition by year’s end, the sources said, with the value of the deal likely to come to around ¥50 billion.

Chinatrust will secure most of the equity in Tokyo Star Bank, which operates in the Tokyo metropolitan area, after Japanese and Taiwanese authorities sign off on the deal, the sources said.

After the acquisition, the Taiwanese bank will use Tokyo Star’s outlets to cultivate business in Japan, including by marketing financial instruments to individuals. It also plans to provide loans to small and medium-sized Japanese companies making inroads into China, the sources said.

Chinatrust also plans to expand mortgages to Taiwanese who want to acquire real estate in Japan, reports say.

The main shareholders of Tokyo Star Bank include U.S. investment fund Lone Star, Shinsei Bank and France’s Credit Agricole.

Tokyo Star is the successor to Tokyo Sowa Bank, a second-tier regional bank that collapsed in 1999 under a pile of nonperforming loans. A loan syndicate including Lone Star and Shinsei Bank acquired its shares in 2011.