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Japan's SBI Holdings, Towa Bank to form capital tie-up
[TOKYO] Japanese financial firm SBI Holdings and regional lender Towa Bank will conduct a capital tie-up and take small stakes in one another, the Nikkei newspaper reported on Thursday.
SBI will provide its technology and financial services to Towa Bank so that the lender can improve its customer service, the Nikkei said, without citing its sources.
Representatives at the two companies declined to comment.
SBI has invested in four regional banks, and CEO Yoshitaka Kitao had said he wanted to expand that to 10.
It is looking to revive struggling regional banks by taking stakes and pushing them into higher-margin businesses.
The strategy may get a boost from Prime Minister Yoshihide Suga who has pledged to strengthen local economies and encourage regional banks to consolidate.
Although regional lenders are dominant outside of Tokyo and other big cities, many are tied to areas where the population is ageing rapidly, and business has been hollowed out. The pandemic has deepened the pain after years of low-margin lending.
SBI is scheduled to release its earnings results on Oct 28.