Sumitomo Mitsui's Kitayama to Resign, Miyata to Be President, Yomiuri Says
Sumitomo Mitsui Financial Group Inc. President Teisuke Kitayama will step down and be replaced by Koichi Miyata as soon as April, the Yomiuri newspaper reported, without saying where it got the information.
Nothing has been decided, said a spokesman for the Tokyo- based lender who asked not to be identified, declining to comment further. Takeshi Kunibe will take over from Masayuki Oku as president of Sumitomo Mitsui Banking Corp., the group’s banking unit, the newspaper reported.
Since becoming president of Japan’s second-biggest lender in 2005, Kitayama steered its focus toward business abroad as economic stagnation and a declining population curtailed lending demand at home. Last year, Sumitomo Mitsui bought Nikko Cordial Securities Inc. from Citigroup Inc. to expand investment banking worldwide, and in January purchased a stake in Hong Kong-based Bank of East Asia Ltd. to tap business in China.
“Unless someone really charismatic takes the presidency, Japanese megabanks’ business won’t change dramatically,” said Mitsushige Akino, who oversees about $450 million in Tokyo at Ichiyoshi Investment Management Co. “The new presidents, whoever they will be, will follow the same path of overseas business, including Asia.”
Japan’s second-biggest lender by market value has outperformed its rivals on the Tokyo Stock Exchange this year, climbing 9.3 percent. Mitsubishi UFJ Financial Group Inc., Japan’s biggest bank, lost 2.9 percent in 2010 and Mizuho Financial Group Inc. dropped 7.8 percent. Sumitomo Mitsui slid 1.9 percent today to end the year at 2,892 yen.
The bank is also diversifying its domestic business. Kitayama, 64, said in an interview this month that it is targeting about 600 billion yen ($7.3 billion) in wealth management assets through a tie-up with Barclays Plc, betting Japanese will move away from traditional retirement savings.
Kitayama said he also plans to tap the Barclays venture to fund infrastructure projects in Africa as domestic lending slows. Bank lending in Japan declined for a 12th month in November, and the government forecasts economic growth will slow to 1.5 percent in the year starting April 1 from a projected 3.1 percent this fiscal year.
“We will continue to inject resources overseas and into our brokerage businesses, which is a growing field,” Kitayama told reporters on Nov. 12.
Separately, Kitayama said in an interview with the Sankei newspaper that Sumitomo Mitsui may increase its stake in consumer lending affiliate Promise Co. Sumitomo Mitsui is ready to support Promise with human resources and operating cash, according to the report.
Sumitomo Mitsui currently holds a 21 percent stake in Promise, according to data compiled by Bloomberg.
Japanese consumer lenders are struggling amid a four-year crackdown on the industry that forced them to pare lending and repay overcharged interest. Promise shares have lost 35 percent this year. Rival Takefuji Corp. went bankrupt in September.
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