Sumitomo Mitsui targets $7b in wealth assets
TOKYO: Sumitomo Mitsui Financial Group Inc. is targeting about 600 billion yen ($7.3 billion) in wealth management assets through its tieup with Barclays Plc, betting Japanese will move away from traditional retirement savings.
"Several hundred billion yen in several years is the picture I have now, meaning probably the range of 500 billion yen to 600 billion yen of assets," Teisuke Kitayama, president of Sumitomo Mitsui, Japan's second-biggest bank by market value, said in an interview in Tokyo this month.
The joint venture, set up by Sumitomo Mitsui's Nikko Cordial Securities Inc. unit in April, is targeting the rising number of Japanese households with more than 500 million yen in investable assets. Kitayama aims to meet demand for wealth management stemming from concern among retirement savers between 30 and 40 years old that an aging and declining population could stretch the government pension system.
As Japanese reduce reliance on traditional forms of savings and diversify retirement portfolios, demand for asset management services will rise, Kitayama said in the interview on Dec. 10.
The Tokyo-based bank hasn't disclosed the current size of its wealth assets under management. Sumitomo Mitsui and Barclays are wooing individuals in and around Tokyo and Osaka, the country's biggest metropolitan areas.
The number of households with net financial assets of more than 500 million yen increased to 61,000 in 2007 from 52,000 in 2005, according to the latest data compiled by Nomura Research Institute Ltd. Total assets among the class grew to 65 trillion yen from 46 trillion yen over the three years.
Assets among households with more than 100 million yen and less than 500 million yen rose 13 percent to 189 trillion yen in the same period. -Courtesy Bloomberg