Major Japanese banks pushing into eastern Europe, Russia

Major Japanese banks have started expanding their operations to central and eastern Europe and Russia, where banking businesses are expected to grow rapidly.

Japanese banks, now finalizing disposal of their non-performing loans, are shifting their focus back to increasing overseas loans and are positioning those regions as key markets next to China and Asia, the Nihon Keizai Shimbun said.

Bank of Tokyo-Mitsubishi Ltd., the key unit of Mitsubishi UFJ Financial Group Inc., plans to open a branch in Prague, Czech Republic, early next year, the business daily said.

The branch to be engaged in handling loans, deposits and foreign exchange will take over its existing representatives' office there, which is currently collecting information and data, the business daily said.

In June, Sumitomo Mitsui Banking Corp. (SMBC), a unit of Sumitomo Mitsui Financial Group Inc., set up a special division at its London branch that focuses on loans to Central and Eastern Europe, it said.

The division's roughly 50 employees will travel to Poland, the Czech Republic and other areas to drum up business. Lending will be carried out through the London branch.

Major banks are also seeking business opportunities in Russia. SMBC established a representatives' office in Moscow in August and plans to upgrade it into a local subsidiary, the daily said.