Daiwa Bank and Asahi Bank, the core banks in the Resona Group, integrated their operations Saturday to form Resona Bank and Saitama Resona Bank.

The group’s banks aim to become “super-regional banks” to provide services to small companies and individual clients in specific local areas.

This is in contrast to the four biggest banking groups, including Mizuho Holdings Inc. and Mitsubishi Tokyo Financial Group Inc., which mainly cater to major corporate customers and individuals across the nation.

Both Resona Bank and Saitama Resona Bank will operate as wholly owned subsidiaries of Resona Holdings Inc. They will kick off actual operations for borrowers and depositors on Monday.

Resona Bank, based in Osaka, has emerged as the biggest bank in the Resona Group, with 443.1 billion yen in capital and .a network of 367 branches, with 181 taken over from Daiwa Bank and 186 taken over from Asahi Bank.

Saitama Resona Bank, based in the city of Saitama, inherited 100 branches that had been operated by Asahi in Saitama Prefecture.

The bank, capitalized at 50 billion yen, will run a network of 113 branches, including three new ones in Tokyo.

Yasuhisa Katsuta, who had been president of Daiwa Bank until Friday, assumed the presidency of Resona Bank, which has 13,300 employees.

Katsuta will remain president of Resona Holdings.

Tadahiro Tone, a former Asahi Bank board member, became president of Saitama Resona Bank, which employs 3,000.

Resona Bank has a deposit base of 21.6 trillion yen and outstanding loans of 21.7 trillion yen, while Saitama Resona Bank has deposits of 8.2 trillion yen and outstanding loans of 5 trillion yen.

On Feb. 12, Resona Holdings said it expects to post a group net loss of 185 billion yen for the 2002 business year, which ends on March 31. The announcement reversed its earlier forecast of a 3 billion yen profit.

It said the revision was due to bigger than expected loan-loss charges and latent losses on securities holdings.

On Thursday, Resona Holdings said it expects to boost its capital base by 100 billion yen by March 31.

Katsuta then said Resona Holdings has sought capital subscriptions from domestic corporate clients in amounts ranging from several hundred million yen to several billion yen.

In addition, he said two overseas business partners — the French financial group Credit Agricole and the Hong Kong-based Bank of East Asia — have pledged to cooperate in the recapitalization plan.

With the capital increase, Resona Holdings expects to maintain its group capital-adequacy ratio at 7 percent to 7.5 percent, higher than the 4 percent required by regulators.

Resona Holdings also controls Kinki Osaka Bank, Nara Bank and Resona Trust & Banking Co.

Resona Bank says its name is from the Latin word “resona,” meaning resonance. It also sounds similar to the Japanese word “riso,” meaning ideal.

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