OSAKA -- Resona Holdings Inc., the holding firm for Daiwa Bank and Asahi Bank, has asked the Hong Kong-based Bank of East Asia to help it recapitalize, company officials said Thursday.
Up to now, Japanese banks have been more inclined to ask European or U.S. banks to help pad their capital accounts. The amount of requested capital appears to be in the order of several billion yen.
Resona Holdings is widely expected to book much larger bad-loan losses than it originally planned for the current fiscal year, to March 31, in response to a Financial Services Agency request to accelerate bad-loan disposals.
Including the planned recapitalization to be aided by the Hong Kong bank, Resona Holdings plans to bolster its capital base by some 100 billion yen over the next two months mainly through sales of new preferred shares, the officials said.
The holding company will also ask its domestic business allies to help it recapitalize, they said.
Daiwa Bank earlier decided to tie up with Bank of East Asia in extending loans to businesses operating on the Chinese mainland.
The Hong Kong bank has bases in Singapore, Taiwan and other places in addition to its bases in mainland China.
Its assets totaled 180 billion Hong Kong dollars, equivalent to 2.8 trillion yen, as of last June 30.