The Financial Services Agency this week gave preliminary approval for Taiwanese lender CTBC Financial Holding Co.'s purchase of Tokyo Star Bank Ltd., two people with direct knowledge of the matter said.
The Taipei-based company plans to complete the acquisition for about ¥53 billion ($518 million) by early June, according to one of the sources, who asked not to be identified because the information is not yet public.
The endorsement follows the Taiwanese regulator's approval last month, paving the way for the first takeover of a Japanese commercial lender by a foreign bank. Taiwan's Financial Supervisory Commission had earlier delayed its approval after finding breaches of internal controls at CTBC's banking unit, the regulator said in March.
Kotoku Watanabe, a spokesman for the FSA in Tokyo, declined to comment, while two calls to a spokeswoman for CTBC in Taipei went unanswered.
CTBC last July agreed to buy a controlling stake in the Tokyo-based lender from shareholders including Lone Star Funds, Shinsei Bank Ltd. and Credit Agricole SA, sources said at the time.
Lone Star agreed to sell Tokyo Star to Japanese buyout firm Advantage Partners LLC in December 2007. The U.S. firm retook control of the bank less than four years later with Shinsei, France's Credit Agricole and Tokyo-based Aozora Bank Ltd.