Japan's SMFG to buy 10% stake in SBI worth more than $580 million

FILE PHOTO: Sumitomo Mitsui Banking Corporation’s signboard is pictured at its branch in Tokyo, Japan, January 25, 2017. REUTERS/Kim Kyung-Hoon

TOKYO (Reuters) -Japan’s Sumitomo Mitsui Financial Group (SMFG) Inc said on Thursday it would take a 9.9% stake in online financial company SBI Holdings Inc in a deal worth more than $580 million.

SBI will issue new shares worth 79.65 billion yen ($586.70 million) to Japan’s second-largest lender by assets in a deal aimed at expanding their operations in online financial services, SBI and SMFG said in separate statements.

The new share issuance would also bolster SBI’s capital which has been stretched since its $1 billion cash bid last year for midsize lender Shinsei Bank Ltd.

SBI has said it aims to become Japan’s fourth-largest banking group after Mizuho Financial Group Inc . It already owns the country’s largest online brokerage, an online bank and an asset manager.

SMFG, Japan’s second-largest lender by assets after Mitsubishi UFJ Financial Group Inc, has its own brokerage unit, SMBC Nikko Securities Inc.

($1 = 135.7600 yen)

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