Japan's fourth largest bank has started operations and the country's major consumer electronics manufacturer will ally with an overseas company
A planned merger between two major Japanese banks has been completed. United Financial of Japan Bank, now the country's fourth largest, is the result of a tie-up between Tokai and Sanwa banks.
UFJ, like other Japanese banks, is saddled with bad debt from creditors who are now out of business. President Masashi Teranishi said the bank plans to dispose of $15 billion in bad loans this year.
He said cleaning up bad loans to make the bank a youthful and energetic institution is a top priority. One immediate problem for UFJ is its heavy exposure to troubled Japanese supermarket chain Daiei. According to Japanese business daily Nihon Keizai, the cash-strapped retailer says it will close 50 stores within a year and will incur a one-time loss of $911 million. Daiei says it is still working out a debt restructuring plan with UFJ and other banks.
Sanyo Electric, Japan's number three consumer electronics maker, says it has agreed to a deal with the Samsung Group of South Korea. The two will cooperate in developing fuel cell technology and other areas. The alliance comes as both companies aim to cut costs and speed up development of non-polluting power systems.
In the auto sector, some mixed news for Isuzu Motors. Industry data show that Isuzu light trucks were the top sellers in their class in Japan last year. However, total truck sales still dropped 15-percent from the year before.
In the week ahead, the government will release consumer price data for December and a private research firm will unveil a report on corporate bankruptcy for the previous year.