Mitsubishi UFJ Financial Group has hired Nomura Holdings, JPMorgan Chase & Co and Morgan Stanley to manage a share sale of about JPY1 trillion yen, reported Bloomberg quoting people familiar with the matter.
The sale will be announced on November 18, when the Tokyo-based bank reports half year earnings. Reportedly, it plans to sell about 2.5 billion common shares and Mitsubishi UFJ Securities Co. unit will help arrange the sale.
Mitsubishi UFJ along with its rivals Sumitomo Mitsui Financial Group and Mizuho Financial Group trail the world’s major banks in capital strength even after selling $20 billion in common stock over the past one year. Mitsubishi UFJ had a core Tier 1 capital ratio of 5.8% at the end of June, compared to JPMorgan’s 8.2% at the end of September and HSBC Holdings’ 8.8% on June 30.
Sumitomo Mitsui and Mizuho Financial can not sell shares in public offerings for at least another month, providing a chance for Mitsubishi UFJ to tap investors for the second time in less than a year, reported the news agency.
Nicholas Smith, director at MF Global FXA Securities, said: “All the major banks require financing. The last to the trough starves. Competitors will find issuance tough, and be forced to make up with money raised by selling from their ample share portfolios.”
