Japan's SMFG to Raise $5.8 Billion in Share Sale

The financial group announced it will raise the money to shore up its tier-1 capital. Japanese banks continue to suffer from a slowing economy, narrow interest margins and excessive exposure to the stock market

The latest capital raising exercise by Sumitomo Mitsui Financial Group (SMFG) shows that Japanese banks are weak, although for different reasons than their Western counterparts who have been hurt by their exposure to the subprime crisis. Japanese banks are suffering from a slowing economy, narrow interest margins and excessive exposure to the stockmarket. So, like Western banks, they are busy raising capital.

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