FUKUOKA – Major online financial company SBI Holdings Inc. and Chikuho Bank said Friday they had agreed on a capital tie-up to help boost the regional bank’s business amid population decline.
Under the deal, SBI will acquire a stake of up to 3 percent in the bank, based in Kurume, Fukuoka Prefecture, and provide expertise on financial product sales and information technology to improve the lender’s profitability, they said.
SBI has been strengthening alliances with regional banks, aiming to become Japan’s “fourth megabank,” following Mizuho Financial Group Inc., Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc.
Last year, SBI announced capital tie-ups with Shimane Bank and Fukushima Bank.
“We expect the alliance with SBI to contribute to revitalizing the local economy by providing more useful and satisfactory financial services,” Chikuho Bank said in a statement.
Chikuho Bank, established in 1952, posted a group net profit of ¥835 million ($7.6 million) in the business year ended March last year, down 31.8 percent from a year earlier.
Many banks in Japan have been affected by population decline and the rising cost of developing systems that deliver financial services via information technology.
In the Kyushu region, local lenders have accelerated mergers and acquisitions, gathering under Fukuoka Financial Group Inc., Nishi-Nippon Financial Holdings Inc. and Kyushu Financial Group Inc. But Chikuho Bank has not sought an alliance with local banks.
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