Tokai Bank and Daiwa Bank joined three major banks in unveiling plans Thursday to apply for public funds to boost their capital bases under the new bank recapitalization legislation that was approved by the Diet earlier this month.Sources at the two banks said they are planning to seek public funds through the government's purchase of preferred stock that has preference over common stock in the payment of dividends and the liquidation of assets, but does not carry voting rights.The development came on the heels of similar moves by the Industrial Bank of Japan, Dai-Ichi Kangyo Bank and Sumitomo Trust & Banking Co. on Wednesday, raising the possibility that almost all of Japan's top 18 banks will apply for public funds to beef up their capital bases under the new law, industry sources said.The sources said other major banks are likely to make the decision on whether to seek public funds by late November, when Japanese banks release earnings results for the first half of the fiscal year ending Sept. 30.Each bank has yet to fix the size of public funds it will seek, but the sources said the sum for each bank will fall in the range of several hundred billion yen to 1 trillion yen.
