Japan-US Business Report Logo

No. 357, June 1999

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Japanese Companies in the US


FINANCIAL SERVICES

Although the sale of the main Japanese operations of nationalized LONG-TERM CREDIT BANK OF JAPAN, LTD. is proceeding more slowly than the government had anticipated, the bank is making progress in disposing of its offshore loans. It has agreed to sell an $11 billion portfolio of U.S.- based loans to GE CAPITAL CORP. The package consists mainly of money lent to major American corporate borrowers and the U.S. subsidiaries of Japanese multinationals. Beyond describing the price as "reasonable," GE Capital did not comment on how much it will pay for the portfolio, which reportedly attracted bids from 90 or so financial institutions. The deal is expected to close by the end of 1999.

SUMITOMO BANK, LTD.'s 1986 decision to put $500 million into GOLDMAN, SACHS & CO. paid off big time when the private Wall Street investment bank offered 13 percent of its shares to the public, including part of the Japanese commercial bank's holdings. Sumitomo Bank sold 9 million of its nearly 37.9 million shares and made close to $457 million on the transaction. Its remaining stock equates to about a 6 percent ownership share in Goldman, Sachs.

Having set its sights on becoming a player in various Internet-related businesses, including financial services, SONY CORP. is scrambling to gain the expertise needed to succeed. Part of this learning experience will be in leasing. It will form a company with HELLER INTERNATIONAL CORP. to lease PCs and broadcasting equipment, with small businesses on tight budgets the main target. Sony will have a 51 percent stake in SONY FINANCIAL SERVICES LLC. Chicago-headquartered Heller, a major provider of financing to midsized and small American companies and a FUJI BANK., LTD. affiliate, will own the balance. Sony Financial Services expected to begin operations in June.

An exchange rate of ¥122=$1.00 was used in this report.aaaaaa

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