Su­mit­omo Mit­sui tar­gets $7b in wealth as­sets

The Pak Banker - - Company& -

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

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