Japan’s banking behemoth Mitsubishi UFJ Financial Group has recently announced its plan to purchase the asset management operations from Australia’s largest money lender Commonwealth Bank of Australia (CBA) in an estimated deal worth around USD 2.7 billion (roughly 300 billion yen).
According to the sources familiar with the matter, the MUFG Group’s arm Mitsubishi UFJ Trust and Banking will completely acquire the multiple core subsidiaries from CBA’s Colonial First State, the asset management group.
If industry experts are to be believed, the low rate of interests, in Japan and around the world, are significantly pushing the financial & banking firms to look for more profitable alternative, such as the asset management, particularly in the rapidly emerging markets of Asia Pacific. They further claim that the MUFG & CBA’s deal symbolizes the growing efforts undertaken by the Japanese banking group to move away from the traditional growth avenues, based on corporate loans.
Mitsubishi UFJ Trust and Banking Corp., said in a company statement that the deal will enhance its product lineup and will also expand its reach across the Asia & Oceania, as it is expected to add assets of A$210 billion, the Reuters reported on October 31.
For the record, MUFG Group’s asset management unit management over 70 trillion yen of assets. The group is Japan’s third-largest asset manager, and holds the 39th position on a global scale. The recent deal with CBA will add around 20 trillion yen to its assets, in turn ascending its position to No.1 domestically.
As reported in a separate statement, the CBA revealed that it will appoint former Westpac executive Jason Yetton as the CEO to head its wealth and mortgage broking operations. Andrew Morgan will be appointed as the Chief Financial Officer.
It has been reported that the deal, which is touted as one of the biggest foreign asset management takeover bids ever by the Japanese financial group, is likely to be closed by the fall of 2019