Regional banks embark on goods, power businesses

The Yomiuri Shimbun

13:47 JST, July 2, 2022

FUKUOKA — Fukuoka City-based Nishi-Nippon City Bank in June began selling pencils, notepads and other promotional goods featuring the bank’s characters.

While regional banks in Japan are trying to expand their business areas beyond their core financial services amid a difficult business environment, it is the first time a bank has sold promotional goods. Stationery with the bank’s dog character Onek — pronounced “wunk” — is being sold at a store in central Fukuoka. The bank has said the products are popular as gifts, and sales have exceeded expectations.

Banks are restricted by the Banking Law from engaging in activities other than their core business. According to Nishi-Nippon City Bank, it has been using Onek goods at events and other occasions and many customers have requested that they be made available for purchase. The bank spent about 30 months in dialogue with the Financial Services Agency before it won permission to sell the goods. The agency recognized the goods-selling business, which improves the value of the bank’s brand and the perception of its financial services, as part of the bank’s core services.

The agency has eased restrictions under the Banking Law when a business contributes to local communities, such as through digitization and regional development.

San-in Godo Bank, based in Matsue, will be the first regional bank to enter the electric power business. The company plans to establish a subsidiary in July to engage in the renewable energy business and generate income by selling electricity produced by solar power on abandoned farmland and other means. Joyo Bank, based in Mito, is also getting into the renewable energy business.

Ehime Bank, based in Matsuyama, is to begin renting out parking spaces at its branches. The bank noted that many of its branches have good locations along major roads. A coin-operated laundromat and a rental warehouse are already set to open business by using the parking spaces. The bank said that this will lead to the expansion of business opportunities for local companies.