Shizuoka Bank, Bank of Nagoya to form business alliance

TOKYO (Jiji Press) — Japanese regional lenders Shizuoka Bank and Bank of Nagoya have broadly agreed to form a comprehensive business alliance, informed sources said Wednesday.

Shizuoka Bank, whose main service area is Shizuoka Prefecture, and Bank of Nagoya, which mainly operates in Aichi Prefecture, aim to boost their earnings power with the envisaged tie-up across the prefectural borders as competition is fierce in the Chubu region, crammed with many regional financial institutions.

Both banks are listed on the Prime top-tier section of the Tokyo Stock Exchange.

Regional banks in Japan have been facing a need to revamp their business models in response to the country’s falling population and rock-bottom domestic interest rates reflecting the Bank of Japan’s prolonged ultraeasy monetary policy.

Among regional banks in Aichi, Aichi Bank and Chukyo Bank agreed in principle in December last year to merge in 2024 after integrating their operation under a joint holding company in October this year, a move that would allow them to seize the top share in outstanding loans among regional lenders in the prefecture, overtaking Bank of Nagoya.

Shizuoka Bank formed a comprehensive business alliance with Yamanashi Chuo Bank, based in Kofu, which borders Shizuoka, in 2020.