Shares of major Japanese banks and brokerages jumped yesterday as investors cheered a global shopping spree by Tokyo’s financial giants in the wake of a historic Wall Street shake-up.
Nomura Holdings Inc, Japan’s biggest brokerage, said late on Tuesday it would buy Lehman Brothers’ operations in Europe and the Middle East, adding to the Asian operations it bought a day earlier from Lehman, which filed for bankruptcy last week.
Nomura’s shares jumped 5.2 percent to ¥1,505 (US$14.02), following a nearly 10 percent rise in the stock on Monday. Japanese markets were closed on Tuesday for a holiday.
Top Japanese bank Mitsubishi UFJ Financial Group Inc advanced 4.2 percent to ¥936 after it announced late on Monday that it had agreed to buy up to a 20 percent stake in US investment bank Morgan Stanley.
And Sumitomo Mitsui Financial Group Inc, Japan’s third-largest bank, added 1.2 percent to ¥684,000 on media reports yesterday that it was considering investing several hundred billion yen in Goldman Sachs.
Sumitomo Mitsui said no decision had been reached at this time and declined to elaborate.
The gains came as the overall Tokyo market edged higher; the benchmark Nikkei 225 index rose 0.2 percent.
Compared with their US counterparts, Japanese financial institutions have emerged from the subprime crisis relatively unscathed. Conservative lending strategies, as well as lessons learned from Japan’s financial crash of the 1990s, are now beginning to pay dividends, analysts say.
“The Japanese have recovered from their own debacle in the 1990s and early 2000s and now have reasonable amounts of capital but not domestic growth,” said David Threadgold, banking analyst at Fox-Pitt Kelton in Tokyo.
“The Americans have squandered unimaginable amounts of money and are now looking around the world at who can help fill the hole,” he said.
Nomura did not disclose a price tag for Lehman’s European assets, but its purchase of the investment bank’s Asian operations was valued at around US$225 million, one person familiar with the matter said on Monday.
Nomura CEO Kenichi Watanabe called the Asian purchase “a once in a generation opportunity” and said the two transactions would help Nomura realize its vision to be a world-class investment bank.
“Our ability to capitalize on this opportunity in spite of such volatile markets reflects our financial strength and demonstrates how well we have managed the credit crisis,” Watanabe said in a statement. “This deal is validation for our strategy.”
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