Mitsubishi UFJ Financial Group explained

is a Japanese bank holding and financial services company headquartered in Chiyoda, Tokyo, Japan.^[5] MUFG was created in 2005 by merger between and UFJ Holdings (株式会社UFJホールディングス; kabushikigaisha yūefujei hōrudingusu). These two groups in turn brought together multiple predecessor banks including Mitsubishi Bank (est. 1880), Yokohama Specie Bank (est. 1880 as a policy bank, reorganized after World War II as Bank of Tokyo), Sanwa Bank (est. 1933 by merger of prior institutions), and Tokai Bank (est. 1941 by merger).

MUFG holds assets of around US$2.7 trillion as of 2024 and is the parent company of fully-owned MUFG Bank (branded Bank of Tokyo Mitsubishi UFJ or BTMU until July 2018^[6]), Mitsubishi UFJ Trust and Banking Corporation, Mitsubishi UFJ Securities, Mitsubishi UFJ Capital, and MUFG Americas Holdings Corporation; majority shareholder of Bank Danamon in Indonesia, Bank of Ayudhya in Thailand, and Mitsubishi UFJ NICOS in Japan; and a large minority shareholder in the Master Trust Bank of Japan, Morgan Stanley in the United States, Security Bank in the Philippines, and Vietinbank in Vietnam. It retains strong links with the Mitsubishi Group and is often described as one of that group’s "Three Great Houses", together with Mitsubishi Corporation and Mitsubishi Heavy Industries.^[7]

MUFG is Japan's largest financial group and one of the world's ten largest bank holding companies holding around US$1.5 trillion (JP¥227 trillion) in deposits as of April 2024.^[8] In Japan, it is the largest of the three so-called megabanks with $2.9 trillion in total assets at end-March 2023, ahead of SMBC Group ($2.0 trillion) and Mizuho Financial Group ($1.9 trillion).^[9] It has been consistently listed as a systemically important bank by the Financial Stability Board.

History

See also: Yokohama Specie Bank, Mitsubishi Bank, Sanwa Bank, Tokai Bank and Bank of Tokyo.

MUFG was formed by three successive mergers in a sequence that lasted less than a decade, respectively between Bank of Tokyo and Mitsubishi Bank in 1996, between Sanwa Bank, Tokai Bank and Toyo Trust and Banking in 2000-2002, and between the two resulting entities in 2005. The institutions involved in these mergers combined multiple threads of Japanese financial history, going back to the early Meiji era. MUFG incorporates several of the National Banks in Meiji Japan, which were numbered in accordance with their chronological date of establishment between 1873 and 1880:

• the, est. 1877 in Toyohashi, merged 1886 into the 134th National Bank;
• the, est. 1877 in Nagoya, merged 1896 with the 134th National Bank to form, a predecessor of Tokai Bank;
• the 13th National Bank, est. 1877 in Osaka, renamed the in 1897, a predecessor of Sanwa Bank;
• the, est. 1877 in Obama, Fukui, merged 1927-1928 with Tsuruga Bank then 1938 into Owada Bank, another predecessor of Sanwa Bank;
• the 30th National Bank, est. 1878 in Tokyo, acquired 1929 by the 34th Bank;
• the 31st National Bank, est. 1878 in Wakamatsu, merged 1888 with the 148th National Bank (see below);
• the 34th National Bank, est. 1878 in Osaka, renamed 1896 as or Sanjushi Bank, a predecessor of Sanwa Bank;
• the 42th National Bank, est. 1878 in Osaka, restructured 1897 into Kitahama Bank then renamed 1919 into Setsuo Bank, merged 1926 into the 34th Bank;
• the 43th National Bank, est. 1878 in Wakayama, split up 1930 into several entities including Daido Bank which merged into the 34th Bank;
• the 95th National Bank, est. 1878 in Tokyo, merged 1925 into Yamaguchi Bank (see 148th bank below) after several name changes;
• the 100th National Bank, est. 1878 in Tokyo, reorganized 1898 as the or Daihyaku Bank, merged 1927 with Kawasaki Bank and absorbed 1943 by Mitsubishi Bank;
• the, est. 1879 in Tokyo, a predecessor of Mitsubishi Bank;
• the 121st National Bank, est. 1879 in Osaka, absorbed 1897 by the 34th Bank;
• the, est. 1879 in Nagoya, merged 1896 with the 11th National Bank to form Aichi Bank;
• the 143th National Bank, est. 1879 in Yachimata, merged 1880 into the 30th Bank;
• the 148th National Bank, est. 1879 in Osaka, reorganized 1898 as, a predecessor of Sanwa Bank;
• the, est. 1879 in Hakodate, merged 1885 into the 119th National Bank.

Bank of Tokyo-Mitsubishi merger

Mitsubishi Bank and the Bank of Tokyo merged in 1996 to form the Bank of Tokyo-Mitsubishi, which at that point was the world's largest bank in terms of total assets.^[10] The Bank of Tokyo had historically focused on foreign exchange business since its foundation as the Yokohama Specie Bank in 1880, while Mitsubishi Bank had had a stronger focus on domestic corporate and retail banking. Both banks were relatively healthy in the wake of the Japanese asset price bubble.^[11] The merged bank was the fully-owned subsidiary of Mitsubishi Tokyo Financial Group (MTFG), based in Tokyo.

Sanwa-Tokai-Toyo merger into UFJ

Until the Tokyo-Mitsubishi merger in 1996, Sanwa Bank, which was based in Osaka and was the anchor of the Sanwa Group keiretsu, had been considered the strongest bank in Japan, and it had aimed to be the world's largest bank during the "bubble era". By 2000, however, Sanwa was the fourth largest bank in Japan. It entered into merger talks with two other large banks, Asahi Bank and Tokai Bank, to create the world's third-largest bank by assets. Asahi pulled out of these talks later that year, and eventually became part of Resona Holdings.^[12] By 2001, The Toyo Trust & Banking Co. had been added to the merger and the combined company was to be called United Financial Holdings.^[13] The merger was completed in 2002 and the new bank was officially named UFJ Bank Ltd.^[14]

UFJ Bank was headquartered in Nagoya, the historical headquarters of Tokai Bank, while its parent UFJ Holdings (UFJH) was based in Osaka. During its short life, the group was plagued by bad debt problems and by infighting between the employees of its predecessor companies. UFJ was one of the largest shareholders of Toyota. The Chairman of Toyota was a director on its board during the financial scandals and indictments of three UFJ executives.

Formation of Mitsubishi UFJ Financial Group

In July 2004, UFJ Holdings, by then Japan's fourth-largest financial group, offered to merge with the Mitsubishi Tokyo Financial Group. UFJ had been accused by the government of corruption and making bad loans to the yakuza crime syndicates. The takeover of UFJ by the Mitsubishi Tokyo Financial Group was challenged by the Sumitomo Mitsui Financial Group which launched a competing takeover bid. MTFG ultimately prevailed in the fight, which appeared to signal an end to the clubby atmosphere that had prevailed in Japan's postwar banking industry.^[15] MUFG and SMFG eventually settled the legal dispute for 2.5 billion yen in late 2006.^[16]

The merged holding company MUFG, based on Tokyo, was formed on 1 October 2005 from the merger of MTFG and UFJH. The two banks, Bank of Tokyo-Mitsubishi and UFJ Bank, merged on 1 January 2006 to form MUFG Bank. The latter transaction was originally scheduled to take place on 1 October 2005, the same day that the parent companies were merged. However, pressure from Japan's Financial Services Agency, which wanted to ensure the smooth systems integration of the two banking giants, caused the merger of the banks to be postponed for three months. The trust banking and securities units of MTFG and UFJ were merged according to the original schedule on 1 October 2005.

Subsequent developments

Mitsubishi Bank and the Bank of Tokyo each had significant banking subsidiaries in California (Bank of California and Union Bank respectively) before their merger. At the time of the merger, these U.S. banks also merged to form UnionBanCal Corporation. BTM listed UnionBanCal on the New York Stock Exchange in 1999. In 2008, BTMU purchased all of the outstanding shares of UnionBanCal. BTMU moved its New York-based banking operations to Union Bank and renamed the company MUFG Union Bank in 2014.

BTMU was investigated by New York banking regulators over its role in routing payments for Iranian customers through its New York branch in violation of U.S. sanctions. BTMU settled with the state for $250 million in 2013. A second settlement was reached for $315 million in 2014 after it was found that PricewaterhouseCoopers had altered an investigation report on the issue; PwC itself was fined $25 million in relation to the matter.^[17]

In September 2008, MUFG signed a letter of intent with Morgan Stanley to form an alliance and purchase 20% of the American firm.^[18]

In 2008 at the 2008 ALB Japan Law Awards,^[19] Mitsubishi UFJ was crowned:

• In-House of the Year – Japan Investment Bank In-House Team of the Year
• Deal of the Year – Debt Market Deal of the Year

In April 2011, MUFG and Morgan Stanley entered into an agreement to convert MUFG's outstanding convertible preferred stock in Morgan Stanley into Morgan Stanley stock.^[20]

In June 2011, MUFG took a 9.99 percent stake in Lynas Corp, an Australian rare earths developer.^[21]

On April 1, 2018, the bank was renamed to MUFG Bank Ltd. This name change aligned the bank name with the holding company name by removing "Tokyo" from the name.^{[22] [23]}

On 31 October 2018, MUFG to acquire Australian Asset Manager, Colonial First State Global Asset Management.^[24]

Group structure

Majority-owned banks

• MUFG Bank, Ltd.
• UnionBanCal Corporation in the United States (approx 63% in Feb 2005; 68% in 2004; 100% in 2008)
• Bank Danamon in Indonesia (92.47%)
• Bank of Ayudhya in Thailand (76.88% on January 5, 2015; 72% on December 19, 2013)^[25]
• Security Bank, semi-major bank in the Philippines
• , online bank

Minority-owned banks

• (39.9%)
• The Master Trust Bank of Japan, Ltd. (46.5%)
• Morgan Stanley (22.41%). On September 29, 2008, Mitsubishi UFJ Financial Group announced that it would acquire a shareholding in Morgan Stanley for US$9 billion. In the midst of the October 2008 stock market crash, concerns over the completion of the Mitsubishi deal caused a dramatic fall in Morgan Stanley's stock price to levels last seen in 1994. Morgan Stanley's share price recovered considerably after Mitsubishi UFJ closed the deal on October 14, 2008.^{[26] [27] [28] [29] [30]}
  • The payment from MUFG was supposed to be wired electronically; however, because it needed to be made on an emergency basis on Columbus Day when banks were closed in the US, MUFG cut a US$9 billion physical check, the largest amount written via physical check at the time.^{[31] [32]} The physical check was accepted by Robert A. Kindler, Global Head of Mergers and Acquisitions and Vice Chairman of Morgan Stanley, at the offices of Wachtell Lipton.^[33]
• Chong Hing Bank (9.66%)
• Vietinbank (20%), with which the Group decided to establish a strategic partnership in December 2012^[34]

Other associated companies

• Trust bank
  • Mitsubishi UFJ Trust and Banking Corporation
• Microfinance
  • Hattha Kaksekar (Cambodia microfinance institution)
• Securities
  • (intermediate holding company)
    • Mitsubishi UFJ Securities (a retail joint venture between with Morgan Stanley)
    • (a joint venture between MUFG and Morgan Stanley)
    • (private banking brokerage business entities)
    • (Internet-only securities)
• Lease
  • • • • • • Research and consulting
      • Mitsubishi Asset Brains
  • Mitsubishi UFJ Trust Investment Engineering Laboratory
• System
  • • • • • • • • • Mitsubishi Research Institute DCS MU Business Engineering
• Asset management
  • The Master Trust Bank of Japan
• Asset management
  • • • MU Investment Advisor
  • MUFG Investor Services
• Venture capital
  • Mitsubishi UFJ Capital
• Wealth management
  • Mitsubishi UFJ Wealth Management Securities
  • Mitsubishi UFJ Personal Financial Advisors
• Factoring
  • Mitsubishi UFJ Factor
• Securities agency
  • Japan share holder service
• Banking agency
  • Mitsubishi UFJ Financial Partners
• Foreign currency exchange
  • • Consumer finance
  • Acom (equity-method affiliate)
• Cards and credit sales
  • Mitsubishi UFJ NICOS
    • • JACCS CO., LTD. (affiliated company accounted for by the equity method)
        • Finance
  • (unlimited company)
• Real estate
  • • Debt collection
    • Public interest corporation
  • Foundation Mitsubishi UFJ Trust Scholarship Foundation
  • Mitsubishi UFJ Trust and Regional Culture Foundation
  • Mitsubishi UFJ Trust Arts Foundation
  • Mitsubishi UFJ International Foundation
  • Mitsubishi Economic Research Institute
  • Mitsubishi Foundation
  • Mitsubishi Yowa

Major shareholders

As of 31 March 2013:

Investment trusts managed by the Japan Trustee Services Bank	7.47%
Investment trusts managed by The Master Trust Bank of Japan	4.44%
Nippon Life	2.01%
ADR Holders (held by the Bank of New York Mellon)	1.94%
State Street	1.53%
State Street (China clients)	1.27%
Meiji Yasuda Life	1.23%
JPMorgan Chase Bank, N.A. London Secs Lending Omnibus Account	1.14%
Toyota	1.05%

Leadership

Chair

• Ryosuke Tamakoshi (2005–2010)^[35]
• Takamune Okihara (2010–2014)^[36]
• Kiyoshi Sono (2014–2019)
• Nobuyuki Hirano (2019–2021)
• Kanetsugu Mike (since April 2021)

Chief executive

• Nobuo Kuroyanagi (2005–2010)
• Katsunori Nagayasu (2010–2013)
• Nobuyuki Hirano (2013–2019)^[37]
• Kanetsugu Mike (2019–2021)
• Hironori Kamezawa (Since April 2021)

See also

• Bank of Tokyo-Mitsubishi UFJ Money Museum
• Loans in Japan
• List of banks in Japan
• List of systemically important banks

References

1. Web site: May 2013 . US. SEC Annual Report (Form 20-F) . dead . https://web.archive.org/web/20151225203448/http://www.mufg.jp/english/ir/annualreport/2013mufg/pdf/mar/ar2013.pdf . 25 December 2015 . 14 October 2013 .
2. Web site: Asset Management.
3. Web site: Who We Are. 13 October 2020.
4. Web site: Mitsubishi UFJ Financial: Number of Employees 2006-2021 | MUFG.
5. "About MUFG ." Mitsubishi UFJ Financial Group. Retrieved on 7 December 2009.
6. Web site: Gulf News . Bank of Tokyo-Mitsubishi UFJ rebranded as MUFG Bank. .
7. Web site: MUFG; Company Overview – Mitsubishi UFJ Financial Group . live . https://web.archive.org/web/20100210043331/http://www.mufg.jp/english/profile/overview/ . 10 February 2010 . www.mufg.jp .
8. Web site: 2024-04-01 . MUFG Americas Corporate Profile . live . https://web.archive.org/web/20240728202225/https://www.mufgamericas.com/who-we-are/we-are-mufg-americas . 2024-07-28 . 2024-07-28 . www.mufgamericas.com . en.
9. Web site: S&P Global . Japanese megabanks retain top slots in ranking even as total assets drop . . Yuzo Yamaguchi & Mohammad Taqi.
10. News: Associated Press. Bank of Tokyo-Mitsubishi Opens for Business as World's Biggest. April 12, 2011. Deseret News. April 1, 1996.
11. Web site: Bank of Tokyo-Mitsubishi Ltd. History. International Directory of Company Histories, Vol. 15. St. James Press, 1996. April 9, 2015. https://web.archive.org/web/20150415085933/http://www.fundinguniverse.com/company-histories/bank-of-tokyo-mitsubishi-ltd-history/. April 15, 2015. live.
12. News: Dvorak. Phred. Asahi Exits Three-Way Bank Deal, Leaving Sanwa, Tokai to Clean Up. April 9, 2015. The Wall Street Journal. June 16, 2000. https://web.archive.org/web/20150416064400/http://www.wsj.com/articles/SB961052280779900259. April 16, 2015. live.
13. News: Kennedy. Sam. Sanwa, Tokai to Merge Under New Name. April 9, 2015. Los Angeles Times. June 28, 2001. https://web.archive.org/web/20150418145635/http://articles.latimes.com/2001/jun/28/business/fi-15919. April 18, 2015. live.
14. Web site: The Origins of Our Bank. The Bank of Tokyo-Mitsubishi UFJ. April 9, 2015. https://web.archive.org/web/20150313172754/http://www.bk.mufg.jp/global/aboutus/origins/index.html. March 13, 2015. live.
15. Web site: Fackler . Martin . 2 August 2004 . Banking Duel in Japan Signals End of Old Ways . 27 July 2019 . The Wall Street Journal.
16. News: Mitsubishi UFJ, Sumitomo Trust settle merger row. April 9, 2015. Japan Times. Associated Press. November 22, 2006.
17. News: Bank of Tokyo Fined for 'Misleading' New York Regulator on Iran. April 10, 2015. New York Times DealBook. November 18, 2014. https://web.archive.org/web/20150416211403/http://dealbook.nytimes.com/2014/11/18/lawsky-fines-bank-of-tokyo-mitsubishi-ufj-another-315-million/. April 16, 2015. live.
18. http://www.morganstanley.com/about/press/articles/6934.html Press Release
19. Web site: Asian Legal Business . www.legalbusinessonline.com.au.
20. Web site: 2011 . Mitsubishi UFJ Financial Group And Morgan Stanley Announce Agreement To Convert Morgan Stanley Convertible Preferred Stock To Common Stock – TheStreet . live . https://web.archive.org/web/20121011194458/http://www.thestreet.com/story/11090166/1/mitsubishi-ufj-financial-group-and-morgan-stanley-announce-agreement-to-convert-morgan-stanley-convertible-preferred-stock-to-common-stock.html . 11 October 2012 . 19 July 2011 . thestreet.com .
21. Web site: 2011 . Mitsubishi UFJ buys 10% of Australia's Lynas – MarketWatch . live . https://web.archive.org/web/20110708094531/http://www.marketwatch.com/story/mitsubishi-ufj-buys-10-of-australias-lynas-2011-07-04 . 8 July 2011 . 19 July 2011 . marketwatch.com .
22. Web site: 東銀ＤＮＡ「海外」残るか 「東京」消え「三菱ＵＦＪ」へ. May 16, 2017. February 5, 2018. https://web.archive.org/web/20171030003009/https://www.nikkei.com/article/DGXLASGC16H03_W7A510C1EE9000/. October 30, 2017. live.
23. Web site: 'MUFG Bank' is the New Global Brand for MUFG's Core Commercial Banking Subsidiary . MUFG.jp . Mitsubishi UFJ Financial Group, Inc. / MUFG Bank, Ltd. . June 30, 2018 . https://web.archive.org/web/20180701030557/http://www.bk.mufg.jp/global/newsroom/news2018/pdf/newse0401.pdf . July 1, 2018 . live .
24. Web site: 31 October 2018 . Mitsubishi UFJ Financial to buy IBA's asset management operations . Australian Financial Review.
25. Web site: Stock Information for Bank of Ayudhya PCL. settrade.com. November 24, 2017. https://web.archive.org/web/20171201041742/http://www.settrade.com/C04_05_stock_majorshareholder_p1.jsp?txtSymbol=BAY&selectPage=5. December 1, 2017. live.
26. News: Fed give OK to Mitsubishi, Morgan Stanley deal. Reuters. October 6, 2008. April 14, 2012. https://web.archive.org/web/20120726032445/http://www.reuters.com/article/2008/10/07/us-financial-fed-morgan-idUSTRE49584320081007. July 26, 2012. live.
27. News: Mitsubishi UFJ buys 21% stake in Morgan Stanley. USA Today. October 13, 2008. April 14, 2012. https://web.archive.org/web/20110220044426/http://www.usatoday.com/money/industries/banking/2008-10-13-morgan-mitsubishi_N.htm. February 20, 2011. live.
28. News: Morgan Stanley hangs on Mitsubishi's $9bn pledge. The Guardian. October 11, 2008. April 14, 2012. https://web.archive.org/web/20150129153438/http://www.theguardian.com/business/2008/oct/11/morganstanley-banking. January 29, 2015. live.
29. News: Mitsubishi UFJ Mulls Multi-Billion Dollar U.S. Bank Acquisition. Bloomberg. April 2, 2012. April 14, 2012. https://web.archive.org/web/20120403014214/http://www.bloomberg.com/news/2012-03-30/mitsubishi-ufj-considers-multibillion-dollar-u-s-bank-buyout.html. April 3, 2012. live.
30. Web site: Mitsubishi UFJ Financial Group to Invest $9 Billion in Morgan Stanley . Morgan Stanley . October 14, 2020 . https://web.archive.org/web/20200404040305/https://www.morganstanley.com/press-releases/mitsubishi-ufj-financial-group-to-invest-9-billion-in-morgan-stanley_6962 . April 4, 2020 . September 29, 2008.
31. Book: Too Big to Fail. Andrew Ross Sorkin. 517–18. Viking. 2009.
32. News: Behold: The $9 Billion Check That Rescued Morgan Stanley . October 14, 2020 . Business Insider . November 20, 2009 . https://web.archive.org/web/20200831120838/https://www.businessinsider.com/the-9-billion-check-to-rescued-morgan-stanley-2009-11 . August 31, 2020.
33. Web site: Morgan Stanley . Episode 04: Surviving the Crisis . https://ghostarchive.org/varchive/youtube/20211221/iPsiYIT79ig . 2021-12-21 . live. YouTube . October 14, 2020 . Timestamp 14:23 . September 16, 2020.
34. News: 27 December 2012 . Mitsubishi UFJ to Buy Stake in VietinBank for $743 Million . Bloomberg . live . 27 December 2012 . https://web.archive.org/web/20130707021756/http://www.bloomberg.com/news/2012-12-27/mitsubishi-ufj-to-buy-20-stake-in-vietinbank-for-743-million.html . 7 July 2013 .
35. Web site: 3 October 2005 . Establishment of Mitsubishi UFJ Financial Group .
36. Web site: 25 February 2010 . Changes of Directors .
37. Web site: 28 February 2013 . MUFG names Hirano, soft-spoken but tough negotiator, as president . Reuters.

External links

• Mitsubishi UFJ Financial Group website—
• Mitsubishi UFJ Financial Group website—