Daiwa Securities Group is set to acquire approximately ¥25 billion ($159 million) in shares of Japan’s Aozora Bank, increasing its stake in the lender to around 20%, Nikkei reports. The brokerage will purchase the shares from City Index Eleventh, a Tokyo-based investment firm formerly associated with the Murakami Fund, and Aya Nomura, daughter of the fund’s leader, Yoshiaki Murakami.
City Index Eleventh and Nomura collectively held a 9.01% stake in Aozora Bank as of March’s end. They had increased their shareholding after Aozora forecasted a loss in February and had been advocating for management improvements. However, they are now ending their involvement.
This move follows Daiwa’s recent ¥52 billion investment in Aozora Bank, aimed at strengthening partnerships in wealth management, real estate, and leveraged buyout financing. Daiwa’s President, Akihiko Ogino, emphasized the strategic value of this collaboration, noting potential profit integration from Aozora’s growth.
Aozora Bank recorded a net loss of ¥49.9 billion for the fiscal year ending in March, primarily due to allowances for bad debts, including those related to U.S. commercial real estate. This new investment aims to solidify the partnership and foster Aozora Bank’s recovery and future growth.
