The blockbuster deal to combine Dai-Ichi Kangyo Bank, Fuji Bank and the Industrial Bank of Japan may be compared to an epic drama. Act one has opened with fanfare. But what if discord develops between the director and playwright? What if the actors turn out to be hams? What if the stage settings are not attractive? The audience would be disappointed and leave their seats. The "financial shakeup" drama would end as a "financial disaster" drama, causing a further erosion of the competitive base of Japan's private financial sector.
The planned union of the three banks under a holding company would create the world's largest financial group in terms of assets. The megadeal involves the whole range of financial services, such as retail and wholesale banking, investment banking, trust banking, portfolio management and insurance. In this regard, it is essentially different from past bank mergers and tieups and from partial alliances with foreign financial institutions.
If the deal succeeds, it will likely pave the way for the building of a new financial system in 21st-century Japan. Success depends on the leadership of the "directors," the quality of the "scenario" and the performance of the "actors." That is why the "audience" is watching the drama with a mix of hope and fear.