Sanwa Bank will sell its trust bank subsidiary to Toyo Trust & Banking Co. in mid-July, officials of the two banks announced Tuesday.
The latest move, approved at their board meetings earlier in the day, is in line with the January announcement by Sanwa and Toyo to form an extensive alliance to survive the ongoing "Big Bang" financial reforms.
In mid-July, after gaining approval from financial authorities, Sanwa will sell all of its 200,000 shares of Sanwa Trust & Banking Co. to Toyo Trust.
Then sometime around mid-October, Toyo Trust will merge with Sanwa Trust. The merged bank will have entrusted assets of 29.6 trillion yen — the third-largest among all trust banks in Japan, the officials said.
The two banks decided on the merger so they can improve efficiency in their operations, the officials added.
Currently, Toyo Trust ranks fourth with entrusted assets totaling 28.3 trillion yen, while Sanwa Trust has entrusted assets of just about 1.27 trillion yen, ranking 22nd among the nation's trust banks.
Sanwa Trust, a wholly owned subsidiary of Sanwa Bank, was established in November 1995 with capital of 10 billion yen. The bank is strong in asset liquidation business, such as monetary claims trusts.