National

MTFG's leaders eyed to head merged group

Mitsubishi Tokyo Financial Group Inc. and UFJ Holdings Inc., eyeing a merger in the next fiscal year, are considering having the president and chairman of MTFG take the same positions in the merged banking group, informed sources said Saturday.

The two groups are negotiating to appoint Mitsubishi Tokyo President Nobuo Kuroyanagi as president of the merged entity, which would be the world’s largest banking group in terms of assets.

They are also considering appointing Mitsubishi Tokyo Chairman Haruya Uehara as chairman of the merged entity, the sources said.

Such appointments would mark a departure from the norm in mergers between Japanese companies because the head of each merging entity usually assumes a top managerial post in the new company.

The sources said the envisaged appointments reflect the fact that their merger is in effect a rescue of UFJ by Mitsubishi Tokyo.

The UFJ group has been struggling with massive losses in disposing of bad loans extended to large-lot borrowers. It posted a net loss of 402.81 billion yen for its 2003 business year, compared with the previous year’s loss of 608.92 billion yen.

Its top managers were reshuffled in May, with former managers stepping down to take responsibility for receiving business improvement orders from the Financial Services Agency, the sources added.

Mitsubishi Tokyo and UFJ announced earlier this month that they had signed a memorandum of understanding to launch negotiations with the aim of integrating their operations during the April-September period of 2005.

The move would create the world’s biggest banking group with total assets of 190 trillion yen.

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