3 Japanese Banks Announce Merger

The trio - Sanwa Bank Ltd., Tokai Bank Ltd. and Asahi Bank Ltd. - plan to set up a joint holding company in April 2001 and reorganize their retail, wholesale, international and other operations. A number of cooperative projects will begin before that, the banks said Tuesday. The deal is the latest in a string of mergers as the Japanese banking industry struggles to regain a competitive edge and overcome billions of dollars in bad loans from a speculative lending boom in the late 1980s and early 1990s. It also positions the new Japanese bank, which has not yet been named, as a global player. Last week, Germany_s Deutsche Bank confirmed plans to merge with Dresdner Bank, creating a behemoth with $1.2 trillion in assets. That would rival in size the Mizuho Financial Group - to be formed by the merger of Dai-Ichi Kangyo Bank, Fuji Bank, and the Industrial Bank of Japan - which will be Japan_s largest institution. Sanwa, Tokai and Asahi pledged to boost profitability and responsiveness to consumers. The new bank will have combined assets of about 106.6 trillion yen ($1 trillion).