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For its biggest banks, however, there's a hitch: a generation of professional front-line staff have little experience with rising interest rates. The 38 members, which include credit dealers and data scientists, work to improve coordination between retail and wholesale divisions, as higher rates are expected to fuel trading activities. Still, if higher rates are new to most bankers, so they are for their clients, who have for years enjoyed rock bottom rates in Japan. "Almost no front-line bankers have experienced short-term rates above 0.5% as Japan last saw such rates in the 1990s," he said. "I think there are a lot of scepticism among front-line bankers over whether they can really increase their lending rates."

Persons: Masahiro Minami, they've, Izuru Kato, Kato, Satoru Yamamoto, Atsushi Kikuchi, Tokyo Tanshi's Kato, Makiko Yamazaki, Ritsuko Shimizu, David Dolan Organizations: MUFG Bank, TOKYO, Resona Holdings, Reuters, Bank, Mitsubishi, Daiwa Securities, Mizuho Financial, Mizuho, Thomson Locations: Japan, Tokyo

☆ Vale Canada, Sumitomo Metal sign initial agreement to sell 14% stake in Indonesia nickel miner
▼ + stars: | 2023-11-18 | by ( ) www.reuters.com time to read: +3 min

REUTERS/Ritsuko Shimizu/File Photo Acquire Licensing RightsJAKARTA, Nov 18 (Reuters) - Vale Base Metals said its Vale Canada unit and Japan's Sumitomo Metal Mining signed an initial agreement on Friday to sell a 14% stake in their Indonesian nickel mining unit to Indonesia's state miner. Share divestment is a condition required by Indonesia to extend Vale Indonesia's mining permit, which will otherwise end in 2025. Upon completion, MIND ID will become the largest shareholder of Vale Indonesia with its stake rising to 34% from 20%. Vale Canada will hold 33.9%, down from 43.79%, and Sumitomo 11.5%, down from 15.03%, according to the statement. "The divestment will make MIND ID as the biggest shareholder of Vale (Indonesia), so MIND ID and Vale Canada can exercise a joint control over Vale (Indonesia)," he said in a statement on Friday.

Persons: Ritsuko Shimizu, Wirjoatmodjo, Deshnee Naidoo, Joko Widodo, Widodo, Fransiska Nangoy, Stefanno Sulaiman, Kirsten Donovan, William Mallard Organizations: Sumitomo Metal Mining, REUTERS, Rights, Base Metals, Vale Canada, Vale, Sumitomo, Mineral Industri, Vale Base Metals, Reuters, Thomson Locations: Tokyo, Japan, Rights JAKARTA, Vale Canada, Mineral Industri Indonesia, Indonesia, Vale Indonesia, Indonesian, Vale

☆ Vale Canada, Sumitomo Metal sign initial deal to sell 14% stake in Indonesian nickel miner
▼ + stars: | 2023-11-17 | by ( ) www.reuters.com time to read: +2 min

REUTERS/Ritsuko Shimizu/File Photo Acquire Licensing RightsJAKARTA, Nov 17 (Reuters) - Mining company Vale Base Metals said its unit Vale Canada Ltd and Japan's Sumitomo Metal Mining Co. Ltd signed an initial agreement on Friday to sell a 14% stake in their Indonesian nickel mining unit to Indonesia's state miner. Share divestment is a condition required by Indonesia to extend Vale Indonesia's mining permit, which is currently due to end in 2025. Upon completion, MIND ID will become the largest shareholder of Vale Indonesia with 34% of shares, up from 20%. Around 20% of Vale Indonesia's shares are publicly traded. Vale Base Metals is committing around $10 billion of investment in Indonesia over the next decade.

Persons: Ritsuko Shimizu, Deshnee Naidoo, Fransiska Nangoy, Kirsten Donovan Organizations: Sumitomo Metal Mining, REUTERS, Rights, Base Metals, Vale Canada, Japan's Sumitomo Metal Mining Co . Ltd, Vale, Sumitomo, Mineral Industri, Vale Base Metals, Thomson Locations: Tokyo, Japan, Rights JAKARTA, Vale Canada, Mineral Industri Indonesia, Indonesia, Vale Indonesia, Indonesian

The logo of Sumitomo Metal Mining Co is pictured at the company's headquarters in Tokyo, Japan, September 13, 2018. REUTERS/Ritsuko Shimizu/File Photo Acquire Licensing RightsTOKYO, Nov 16 (Reuters) - Japan's Sumitomo Metal Mining (5713.T) is considering producing cathode battery materials in the United States among other options as it looks to expand output to meet demand from electric vehicles, an executive said on Thursday. Sumitomo Metal plans to bolster its annual output capacity to 120,000 tons by March 2028 and 180,000 tons by March 2031. The consortium consists of Sumitomo Metal, Mitsubishi (8058.T) and Mitsui (8031.T). Sumitomo Metal is targeting to boost annual nickel output capacity to 150,000 tons in a long-term from 82,000 tons now.

Persons: Ritsuko Shimizu, Katsuya Tanaka, ARL.AX, Masaru Takebayashi, Yuka Obayashi, David Evans Organizations: Sumitomo Metal Mining, REUTERS, Rights, Sumitomo Metal, Panasonic, U.S, Kalgoorlie Nickel, Mitsubishi, Mitsui, Thomson Locations: Tokyo, Japan, United States, Niihama, Pomalaa, Kalgoorlie, Western Australia

[1/2] A man walks past a signboard of Mitsubishi UFJ Financial Group and MUFG Bank at its headquarters in Tokyo, Japan April 3, 2018. Globally bonds have been heavily sold for weeks - prompting the Bank of Japan to step in to steady the JGB market - as investors reckon on interest rates around the world staying elevated. The lingering concerns, coupled with the prospect of further central bank policy tweaks, are likely to keep investors on guard against buying JGBs," he said. Even if the BOJ raises short-term rates, it will probably have to maintain the YCC framework to avoid any abrupt rise in long-term interest rates, Seki said. The BOJ will have no choice but to engage with long-term rates "because the complete removal of a target band could cause volatility in yield curve and sharp spikes in long-term interest rates," he said.

Persons: Toru Hanai, Hiroyuki Seki, Seki, Makiko Yamazaki, Ritsuko Shimizu, Leika Kihara, Muralikumar Organizations: Mitsubishi UFJ Financial, MUFG Bank, REUTERS, Rights, Bank of, Bank of Japan, Reuters, Thomson Locations: Tokyo, Japan, U.S

Stock incentives are seen positively by the market "as higher stock prices directly boost such incentives," she said. Sony, which introduced stock incentives years ago for some management levels, recently changed its framework to make the incentives more attractive, a spokesperson said. "The stock incentives are aimed at beefing up engagement with employees and promoting their interest in raising corporate value." Today, employee stock incentives are also a way for companies to replace cross-shareholdings, a common practice where companies take stakes in partners to cement relationships and avoid activist investors. Despite its increasing popularity, just a quarter of top 100 Japanese companies have employee stock incentives compared to more than 80% in the United States or Germany, data by consulting firm Human Resources Governance Leaders shows.

Persons: Kim Kyung, Motomi Hashimoto, Hitoshi Tanimura, Shintaro Takano, Shinzo Abe, Shinji Ishikawa, Makiko Yamazaki, Ritsuko Shimizu, Miral Organizations: Nikkei, REUTERS, Rights, ANA Holdings, ANA, Sony Group, Tokyo Stock Exchange, Nomura Securities, Reuters, Sony, Human Resources, Leaders, Mitsubishi UFJ Trust, Thomson Locations: Tokyo, Japan, Omron, United States, Germany

[1/2] Union workers of Sogo & Seibu hold banners which read 'on strike' in front of the company's flagship Seibu Ikebukuro store in Tokyo, Japan August 31, 2023. In a statement, Fortress said it would work with Seven & i to support Sogo & Seibu's management to maintain its workforce "to the extent possible." It plans to invest more than 20 billion yen with partner Yodobashi to renovate Sogo & Seibu's stores, it said. Sogo & Seibu's workers had the support of labour groups from rival department stores including Takashimaya and Isetan Mitsukoshi (3099.T). The Seibu Ikebukuro store is Japan's third-largest department store by sales, according to media reports, but its owner Sogo & Seibu has been in the red for the last four years.

Persons: Irene Wang, Fortress, Yodobashi, it's, Yasuhiro Teraoka, Isetan Mitsukoshi, Wakana Shuto, Stephen Givens, Ritsuko Shimizu, Mariko Katsumura, Kaori Kaneko, Rocky Swift, Chang, Ran Kim, Edwina Gibbs, Stephen Coates, Miral Organizations: Union, Sogo, Seibu, company's, REUTERS, Workers, Fortress Investment Group, Yodobashi Holdings, Rikkyo, Japan Inc, Thomson, & & ' Locations: Tokyo, Japan, U.S, TOKYO, Ikebukuro, Sogo, Seibu Ikebukuro

[1/2] Union workers of Sogo & Seibu hold banners which read 'on strike' in front of the company's flagship Seibu Ikebukuro store in Tokyo, Japan August 31, 2023. Some 900 workers at the flagship Seibu store in the bustling district of Ikebukuro are protesting the sale of Sogo & Seibu, a unit of retail giant Seven & i (3382.T), to U.S. fund Fortress Investment Group. This one-day strike - the first at a major Japanese department store in 61 years - followed months of negotiations between Sogo & Seibu management and the workers' union, and comes amid a labour shortage in Japan. Other Seibu and Sogo department stores were open for business as usual. The Seibu Ikebukuro store is Japan's third-largest department store by sales, according to media reports, but its owner Sogo & Seibu has been in the red for the last four years.

Persons: Irene Wang, Isetan Mitsukoshi, Wakana Shuto, Stephen Givens, it's, Ritsuko Shimizu, Mariko Katsumura, Kaori Kaneko, Rocky Swift, Chang, Ran Kim, Edwina Gibbs, Stephen Coates, Miral Organizations: Union, Sogo, Seibu, company's, REUTERS, Workers, Fortress Investment Group, Yodobashi Holdings, Rikkyo, Japan Inc, Thomson Locations: Tokyo, Japan, U.S, TOKYO, Ikebukuro, Sogo, Seibu Ikebukuro

☆ Japan sees rare strike as workers at landmark department store protest sale
▼ + stars: | 2023-08-31 | by ( Mariko Katsumura 清水律子 | Mariko Katsumura | ) www.reuters.com time to read: +4 min

The slogan on the banner in the centre reads, 'Sogo & Seibu, strike solidarity'. This one-day strike - the first at a major Japanese department store in 61 years - followed months of negotiations between Sogo & Seibu management and the workers' union. Other Seibu and Sogo department stores were open for business as usual. "Considering the industry's difficulties, the conditions at Sogo & Seibu are not unique." Sogo & Seibu has been in the red for the last four years and has some 300 billion yen in debt.

Persons: Satomi Saito, Isetan Mitsukoshi, Daimaru, Wakana Shuto, Ritsuko Shimizu, Mariko Katsumura, Kaori Kaneko, Rocky Swift, Chang, Ran Kim, Edwina Gibbs Organizations: Sogo, Seibu, company's, Kyodo, Workers, Fortress Investment Group, Yodobashi Holdings, Yodobashi, Hankyu Hanshin, Rikkyo, Thomson Locations: Tokyo, Japan, U.S, TOKYO, Ikebukuro, Sogo

☆ Sogo & Seibu sale to go ahead, triggering rare workers' strike in Japan
▼ + stars: | 2023-08-30 | by ( ) www.reuters.com time to read: +2 min

The logo of Seven & I Holdings is seen at its headquarters in Tokyo, Japan December 6, 2017. The union intends to carry out its threat for a strike at the flagship Seibu Ikebukuro store in Tokyo on Thursday, according to a union member. A person with direct knowledge of Seven & i's plan said its board would meet on Thursday to officially decide on the sale. The union received no reply and would therefore carry out the strike on Thursday at the flagship store, where about 900 union members are employed, he said. Fortress had initially planned to spend around 250 billion yen ($1.71 billion) on the acquisition but is likely to have lowered that price to about 220 billion yen, the source said.

Persons: Toru Hanai, Fortress, Ritsuko Shimizu, Kantaro, Chang, Ran Kim, Simon Cameron, Moore Organizations: Holdings, REUTERS, Seibu, Fortress Investment, Labour, UA, Sogo's, Sogo, Thomson Locations: Tokyo, Japan, U.S

TOKYO, June 27 (Reuters) - State-backed Japan Investment Corp (JIC) sees potential for more mergers and acquisitions in high-end corners of the chipmaking industry following its planned $6.4 billion buyout of materials maker JSR (4185.T), the head of its private equity arm said. "We see potential in some speciality materials markets where JSR can win dominant positions by combining with other materials makers," Ikeuchi said in an interview. "We believe that we can boost Japanese chip materials makers' global competitiveness by spurring industry consolidation," he added. In the chemicals industry, for example, Japan has "too many players making similar products that were once competitive but are now commoditised," Ikeuchi said. JIC, overseen by the powerful trade ministry, was set up in 2018 to invest in Japanese companies to boost the nation's competitiveness.

Persons: Shogo, Ikeuchi, JIC, Makiko Yamazaki, Ritsuko Shimizu, Jamie Freed Organizations: Japan Investment Corp, JIC Capital, Japan, Innovation Network Corp of Japan, Thomson Locations: TOKYO, chipmaking, Japan

☆ 7-Eleven spin-off would jeopardise growth, CEO says, pushing back at ValueAct
▼ + stars: | 2023-05-05 | by ( Ritsuko Shimizu | ) www.reuters.com time to read: +2 min

TOKYO, May 5 (Reuters) - A spin-off of 7-Eleven would jeopardise the convenience store chain's future growth by cutting it off from its parent's strength in the food business, the chief executive of Japan's Seven & i Holdings Co Ltd (3382.T) told Reuters. ValueAct has long been critical of Seven & i's conglomerate structure, calling for a spin-off of the 7-Eleven chain or for a sale of the entire company, but Isaka said that would not be in the chain's best interests. "The risk and probability of 7-Eleven Japan's growth coming to a halt would be very high if the company's product development resources were to be cut off," he said. In April, ValueAct ratcheted up the pressure on the company, calling for Isaka's departure and saying he was responsible for a "flawed strategy". Isaka said 7-Eleven is reliant on staff and know-how from Seven & i's supermarket businesses, such as Ito-Yokado, in developing products for its "Seven Premium" private brand.

"We think the company should spin off 7-Eleven and that this could help close the valuation discount," Artisan Partners Associate Portfolio Manager Ben Herrick, told Reuters. Investors, including Artisan Partners, ValueAct and a domestic institutional investor contacted by Reuters that is not permitted to discuss its views publicly, are blaming Seven & i's stagnant share price on management's attachment to a conglomerate structure. SPIN-OFF PROPOSALThree months ago, ValueAct proposed a tax free spin-off of 7-Eleven, via a listing on the Tokyo Stock Exchange in roughly one year. One investor said 7-Eleven, the company's crown jewel, will stop shining brightly unless it is spun off. A source said Seven & i president Ryuichi Isaka is one of the board members ValueAct wants to replace.

☆ Mitsubishi UFJ to postpone AT1 bond issuance in Credit Suisse fallout
▼ + stars: | 2023-04-03 | by ( ) www.reuters.com time to read: +1 min

TOKYO, April 3 (Reuters) - Mitsubishi UFJ Financial Group Inc (8306.T) will postpone the issuance of Additional Tier-1 (AT1) bonds to mid-May or later from late April, a spokesperson said on Monday, after the Swiss decision to wipe out Credit Suisse bonds rattled the market. Mitsubishi UFJ decided on the postponement taking into account investor appetite and market conditions, the spokesperson said. Sources have said Mitsubishi UFJ and Sumitomo Mitsui Financial Group Inc (8316.T), may put April issuance on hold amid the volatility. As part of the rescue of Credit Suisse (CSGN.S) by its rival UBS (UBSG.S), Swiss regulator FINMA determined that Credit Suisse's AT1 bonds with a notional value of 16 billion francs ($17.35 billion) would be wiped out, a decision that stunned global credit markets and angered many holders. Reporting by Ritsuko Shimizu and Makiko Yamazaki; Editing by Varun H KOur Standards: The Thomson Reuters Trust Principles.

TOKYO, March 31 (Reuters) - Japanese regional lenders will be well able to weather even "large" losses on their foreign bond portfolios thanks to strong capital buffers, a senior banking regulator official said, rebuffing concerns fuelled by U.S. banking woes. "Overseas media seem to be focusing on Japanese regional banks in association with the SVB collapse, but I'd like to emphasise that they are completely different," he told Reuters in an interview. Analysts at SMBC Nikko Securities calculated unrealized foreign bond losses at over 70 listed Japanese regional banks totalling 1.4 trillion yen ($10.6 billion) at the end of last year, the worst in decades for global bond markets. "It is true that unrealized losses on foreign bond holdings at some regional banks are large, but the banks have enough capital buffers even when such losses are taken into account," Yashiki said. He also said he saw no immediate need to review Japan's regulatory framework as Japanese banks have grown resilient with significantly improved asset quality.

TOKYO, March 28 (Reuters) - The Japanese construction company targeted for takeover by the family office linked to Nintendo Co's (7974.T) founder is pushing back against the fund and has asked the government to investigate alleged breaches of foreign ownership rules. Toyo Construction Co (1890.T), the marine construction company now 27% owned by Yamauchi-No.10 Family Office (YFO), made the request to the government this month, according to a letter seen by Reuters. YFO has amassed most of its 27% stake through three related investment companies registered in the Cayman Islands, each of them with less than 10%. It said the three investment vehicles were not closely related as defined by law in terms of the capital structure and that all three had different directors. "In both the acquisition of Toyo Construction shares and the formulation of the buyout proposal, we have been in close consultation with regulators throughout.

Other investors who have held Toshiba longer may not be so lucky: the offer price represents a 15% discount from a December 2014 high. Some were introduced to JIP by Toshiba's management, some of the people said, declining to be identified because the information is not public. Toshiba's management, including CEO Taro Shimada, will stay on, while the government keeps Toshiba's sensitive defence and nuclear technologies in Japanese hands. Toshiba felt stable shareholders were desirable to end the tumult, unlike current shareholders "with many differing views", it said. JIP does not see the need for big strategy adjustments, Toshiba said.

SummarySummary Companies C.banks responded to risk-aversive moves in markets - MatsunoJapan's banking system stable as a whole - MatsunoFinmin says will keep assessing impact of Credit Suisse buyoutMarket rout may complicate BOJ's exit path from easy policyTOKYO, March 20 (Reuters) - Japan's top government spokesperson said on Monday the banking system was stable, seeking to reassure markets the country won't see a contagion from U.S. and European banking sector woes. "Each country promptly ramped up efforts as risk-aversive moves were seen in financial markets," Matsuno told a regular news conference. "Japan's financial system is stable as a whole," he said, adding that authorities were watching financial market moves "with a strong sense of alarm". For now, financial authorities in Tokyo see the most likely risk for Japan coming from a deterioration in the U.S. economy that would hurt exports, rather than a direct bank contagion. "The failure of two U.S. banks spilled over to a Swiss bank in a seemingly unrelated way," one official said.

"Each country promptly ramped up efforts as risk-aversive moves were seen in financial markets," Matsuno told a regular news conference. "Japan's financial system is stable as a whole," he said, adding that authorities were watching financial market moves "with a strong sense of alarm". The remarks came after Finance Minister Shunichi Suzuki told reporters on Monday the government would continue to "carefully assess" how a weekend rescue deal for Credit Suisse Group would affect Japan's financial sector. For now, financial authorities in Tokyo see the most likely risk for Japan coming from a deterioration in the U.S. economy that would hurt exports, rather than a direct bank contagion. "The failure of two U.S. banks spilled over to a Swiss bank in a seemingly unrelated way," one official said.

But its tussle with the $620 million Toyo, Japan's third-largest marine construction firm in which it holds 27%, has been anything but whimsical. When asked for comment, Toyo Construction said it intended to set up a committee to consider the takeover proposal. It said it repeatedly requested more information to help it evaluate the offer but the Yamauchi office had not responded. The Yamauchi family office announced its all-cash offer to take Toyo private in May last year, a 30% premium to an earlier bid by Toyo's then largest shareholder. The board supported the lower offer, which later lapsed and the Yamauchi family office says it spent many months trying to engage with the board.

Kazuo Ueda, a 71-year-old university professor who has kept a low profile despite strong credentials as a monetary policy expert, ticked some important boxes. While he was not even on the list of dark horse candidates floated by the media, Ueda was well known in global central bank circles. The bank's preferred choices were incumbent deputy governor Amamiya, as well as former deputies Hiroshi Nakaso and Hirohide Yamaguchi, given their deep knowledge on monetary policy. Matsuno said he hoped the BOJ works closely with the government and guides monetary policy flexibly, when asked whether Ueda's appointment could lead to a retreat from Abenomics. While he warned of the rising cost of the BOJ's yield control policy, Ueda has called for the need to keep monetary policy loose to ensure Japan stably achieves the bank's 2% inflation target.

"The company has received a proposal from the JIP consortium," Toshiba said in a statement. Two of the sources said major Japanese banks, including Sumitomo Mitsui Financial Group (8316.T), had issued letters of commitment to provide 1.4 trillion yen ($10.6 billion) in loans to the group. The final buyout proposal would also include an equity portion of about 1 trillion yen, they said. The Nikkei business daily reported the total value of the buyout proposal was around 2 trillion yen. JIP was then asked by Toshiba to provide commitment letters from banks by Nov. 7, something it was unable to do.

Major Japanese banks, including Sumitomo Mitsui Financial Group (8316.T), had issued letters of commitment to provide the loans to the JIP-led group, said two of the sources, who declined to be identified because the information has not been made public. The 1.4 trillion yen of loans included a commitment line of 200 billion yen for working capital, the sources said. The final buyout proposal would also include an equity portion of about 1 trillion yen, they said. The Nikkei business daily reported a final buyout proposal worth around 2 trillion yen. The banks asked Toshiba to promise the sale of underperforming businesses if earnings deteriorated after a buyout was concluded, sources, including those who spoke on Thursday, have previously said.

Major Japanese banks, including Sumitomo Mitsui Financial Group (8316.T), have issued letters of commitment to provide the loans to the JIP-led group, said the sources, who declined to be identified because the information has not been made public. The Nikkei business daily reported a final buyout proposal worth around 2 trillion yen had been submitted. Sources said the 1.4 trillion yen of loans included a commitment line of 200 billion yen for working capital. Toshiba named the JIP-led group as its preferred bidder in October. The private equity firm was then asked by Toshiba to provide commitment letters from banks by Nov. 7, something it was unable to secure by that date.

☆ Analysis: BOJ bullishness on wages suggests days of super-low rates are numbered
▼ + stars: | 2023-01-19 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

Kuroda likely put YCC on life support so his successor can strategise an orderly exit, said former BOJ official Nobuyasu Atago. He said the bank could raise the 0.5% yield cap to as high as 1% around mid-year and ditch negative rates by year's end. The parent of casual clothing giant Uniqlo says it will raise wages as much as 40%. "If the BOJ ends negative rates, that would widen the spread between deposit and lending rates so would definitely be positive for us," he said. With YCC creaking under market pressure, the BOJ may not be able to wait too long.

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