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No. 353, February 1999

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Japanese Companies in the US


FINANCIAL SERVICES

At a time when other Japanese banks are pulling out of the U.S. marketplace, INDUSTRIAL BANK OF JAPAN, LTD. strengthened its commitment by buying the shares it did not own in IBJ SCHRODER BANK & TRUST CO. IBJ acquired a 49 percent stake in the New York City bank from London's SCHRODER P.L.C. in 1985 and increased its ownership to 97.3 percent in 1987. Following IBJ's purchase of the remaining shares, IBJ Schroder, which has $2.5 billion in assets, changed its name to IBJ WHITEHALL BANK & TRUST CO. It will continue to focus on providing financing and investment advice to the middle market as well as on serving institutions and high-income individuals. Through headquarters and regional offices in Atlanta, Boston, Cleveland and Miami, IBJ Whitehall employs about 550 people.

With the goal of boosting its futures and derivatives businesses in the United States, FUJI SECURITIES, INC., a subsidiary of FUJI BANK, LTD., spun off its Chicago-based futures division into a separate company. Over the 1990s, that operation has expanded to account for nearly 40 percent of the New York City-headquartered parent's revenues. It is the top trader in Eurodollar interest-rate futures on the Chicago Mercantile Exchange.

As part of its wide-ranging strategic alliance with CITIGROUP INC. (see Japan-U.S. Business Report No. 346, July 1998, p. 15), NIKKO SECURITIES CO., LTD. sold its American and European futures operations to that company's SALOMON SMITH BARNEY INC. investment banking/brokerage unit. In the United States, the transaction meant the closure of the broker's Chicago office. Nikko Securities started that operation in 1985. Three years later, it became the first Japanese company to serve as a clearing member of the Chicago Board of Trade and the Chicago Mercantile Exchange.

Come July, DAI-ICHI KANGYO BANK, LTD. will liquidate DKB SECURITIES (U.S.A.) CORP. Established in 1989, the Manhattan brokerage is one of less than three dozen companies authorized to function as primary dealers in U.S. government securities. .....As another part of its international restructuring, DAI-ICHI KANGYO BANK, LTD. is closing its San Francisco branch after shuttering its offices in Atlanta and Houston in December. Once the consolidation of its U.S. operations is completed, the big commercial bank will have branches in New York City, Chicago and Los Angeles.

JAPAN ASIA INVESTMENT CO., LTD., the largest independent Japanese venture capital company, has formed a wholly owned subsidiary in Menlo Park, California. As its name suggests, the firm, which also has the distinction of being just one of two Japanese venture capital companies whose stock is traded on the over-the-counter market, now focuses on investments in start-ups in Japan and Southeast Asia. However, with the establishment of JAIC AMERICA, INC., the firm has set its sights on investment opportunities in the United States.

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