Sumitomo Mitsui Will Maintain Support for Olympus, Bank’s President Says
Sumitomo Mitsui Financial Group Inc. (8316), Olympus Corp. (7733)’s biggest shareholder, will maintain support for the world’s largest endoscope maker and help it keep its global lead, as the camera maker reels from a $1.7 billion accounting fraud, the bank’s president said.
“Olympus has developed one of Japan’s most vital technologies,” Koichi Miyata said in an interview on Dec. 21. “We’ll stand by the company as its most intimate lender because it is important to protect the technology, where Olympus has 70 percent of the market.”
Miyata’s remarks follow those of Katsunori Nagayasu, chairman of the Japanese Bankers Association, on Dec. 15 expressing continued lender support for the manufacturer. Japanese prosecutors raided Tokyo-based Olympus’s offices on Dec. 21, more than a month after the company admitted to hiding investment losses over more than a decade.
Olympus on Dec. 14 restated more than five years of earnings to avoid being automatically delisted from the Tokyo Stock Exchange after admitting to the 13-year cover-up. The company inflated fees to advisers on the 2008 acquisition of Gyrus Group Plc and overpaid in purchasing three Japanese companies with the intention of increasing goodwill, an independent panel investigating the fraud said Dec. 6.
While being a listed company is a key to Olympus’s access to financial tools for its recovery, Sumitomo Mitsui’s financial support for the company wouldn’t be changed if it was removed from the exchange, Miyata said.
Olympus President Shuichi Takayama has said he will consider all options to restore capital after slashing net assets 70 percent following the restatement.
The camera maker’s long-term loans with Sumitomo Mitsui totaled 153.7 billion yen ($1.98 billion) as of Sept. 30, according to an Olympus document distributed at its meeting with banks on Nov. 16.
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