Business / Corporate

Mitsubishi UFJ group to book ¥40 billion extraordinary loss as it streamlines branches

Kyodo

Mitsubishi UFJ Financial Group Inc. plans to book an extraordinary loss of about ¥40 billion ($370 million) in fiscal 2017 as its banking unit is considering reorganizing about 15 percent of domestic branches, sources close to the matter said Friday.

MUFG Bank Ltd., a core unit of MUFG, is considering closing or merging 85 unprofitable branches out of its 515 total in Japan in light of a decline in the number of customer visits, as more and more people use their smartphones for banking.

The bank, like its domestic competitors, has also seen its profits squeezed by prolonged monetary easing measures carried out by the Bank of Japan.

MUFG Bank has been dealing with Japan’s tough business climate by increasing the number of branches that feature automated tellers, allowing it to have a smaller number of on-site employees.

The nation’s biggest financial group is considering restructuring its branches to cut costs as it works on a new three-year business plan covering operations through March 2021.

As part of its reform efforts, MUFG aims to cut its domestic workforce by about 6,000 employees — from more than 40,000 — by the end of March 2024.

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