Morgan Stanley and Japan’s largest commercial bank, Mitsubishi UFJ Financial Group, are aiming to create the largest investment bank in Japan, ousting Nomura Holdings from the top spot. The two companies have also agreed to combine their Japanese securities units to form the country’s third largest brokerage unit, according to a Wall Street Journal report.
Japan has been somewhat closed to foreign banks who would like to advise companies on marketing products to Japanese households. Whereas large domestic firms such as Nomura had easy access to the $14+ trillion in Japanese household savings through its retail brokerage network. The combined venture by Morgan Stanley and Mitsubishi will open up Morgan’s access to that market, according to Walid Chammah, co-president of Morgan Stanley & Co.
Mitsubishi Financial Group (MUFG) is slated to own 60% of the new firm while Morgan Stanley will have a 40% stake.