Mitsubishi UFJ Financial Group Inc. on Friday will complete the repayment of public funds funneled to the bank in the late 1990s, the company said, becoming the first megabank to fully repay its debts to the government.
The bank was created last October through a merger of Mitsubishi Tokyo Financial Group Inc. and UFJ Holdings Inc.
MUFG said its outstanding balance of loans is now 300 billion yen. The holding company made a 200 billion yen repayment late last month.
The final 300 billion yen portion will be repaid by asking the government's Deposit Insurance Corp. to convert its holdings of Mitsubishi UFJ preferred shares into common stock and then selling them on the open market Friday.
The proceeds are expected to reach 410 billion yen.
The extra 110 billion yen raised by the sale will end up in the national coffers.
When Mitsubishi Tokyo Financial Group and UFJ Holdings merged Oct. 1, the new holding company inherited 1.4 trillion yen in debts to the government from UFJ Holdings.
Sumitomo Trust Banking Co. was the first among the major banks and banking groups to pay off its debts to the government.
Mizuho Financial Group Inc. is expected to complete its repayments to the government in July.