Japan’s MUFG sells US retail bank subsidiary to US Bancorp in $8b deal
It is exiting the retail banking business to refocus on corporate transactions.
MUFG is selling all shares of its North American subsidiary to US Bancorp for $8b, a move that will see the Japanese banking giant exit the US retail banking market.
In a press release, the bank revealed that it has decided to transfer all shares of MUFG Union Bank (MUB) to USB and will be shifting its focus to corporate transactions in the US.
“MUFG will continue to pursue growth strategies and streamline operations and systems in the US by focusing management resources on our wholesale corporate and investment banking franchise through alliances among the bank, the trust bank and the securities firm under MUFG as well as the strategic alliance with Morgan Stanley,” MUFG said in the press announcement, regarding its future plans following the sale.
MUFG said that it decided on the sale after noting the need for increased technology investments for MUB as part of digital transformation and its operating environment, for which “a certain scale is required to maintain and strengthen competitiveness.”
Upon transfer of the assets, USB, which is already one of the major banks in the US, will be the fifth-largest bank in the country by total assets.
MUFG and USB plan to enter into a Transitional Service Agreement (TSA) and a Reverse Transitional Service Agreement for a period of time following the completion of the share transfer