Sumitomo Mitsui Financial Group Inc. (8316)’s trust banking arm plans to almost double employees in the next three years to 300 to expand services for wealthy individuals in Japan.
SMBC Trust Bank Ltd. seeks to boost headcount from 170 through hiring as well as transferring staff from Sumitomo Mitsui’s core banking unit, Executive Director Chiharu Yamada said in an interview on June 11. The Tokyo-based bank manages more than 200 billion yen ($2 billion) for clients who have financial assets of more than 500 million yen, Yamada said.
Sumitomo Mitsui’s purchase of Societe Generale SA (GLE)’s Japan private-banking unit last year enabled it to join Mitsubishi UFJ Financial Group Inc. (8306) and Mizuho Financial Group Inc. (8411) in offering trust services. Succession planning for retiring small-business owners is one of the areas that the bank will focus on to boost assets, Yamada said.
“Japan’s aging population is a big theme, especially for the rich who need to pass their business and wealth on to the next generation,” Yamada said. “I’m confident that we can increase wealth assets under management to 300 billion yen soon,” he said, without giving specific timing.
Japan is the world’s fastest-aging nation, with a quarter of the population 65 or older, National Institute of Population & Social Security Research estimates show. The country’s households held about $16 trillion yen of financial assets as of December, according to central bank data.
Shares of Sumitomo Mitsui, the country’s second-largest lender by market value, fell 0.8 percent to 4,275 yen at the midday break in Tokyo, taking this year’s decline to 21 percent. Japan’s three biggest banks have dropped more than the benchmark Topix (TPX) index’s 5.5 percent retreat this year amid concern that a lending recovery will remain too weak to make up for shrinking interest margins.
SMBC Trust began serving clients referred by its parent company this month to boost its customer base, according to Yamada. The firm also plans to boost real-estate brokerage services to increase fee income, he said.
Sumitomo Mitsui bought Paris-based Societe Generale’s Japanese private banking unit last October for an undisclosed sum. In 2010, Sumitomo Mitsui formed a private-banking venture with Barclays Plc (BARC) for affluent Japanese clients.
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