Earlier, it had agreed to buy Daiwa's assets from Citigroup
Sumitomo Mitsui Financial Group is preparing to snap its brokerage venture with Daiwa Securities Group – reported Bloomberg. Earlier, it was reported that the Tokyo-based bank had agreed to buy the assets of the retail brokerage unit for $5.9 billion from Citigroup. At present the Japan’s banking major holds 40% stake in Daiwa.
Sumitomo is ramping up its own securities business to compete with Nomura Holdings that had acquired Lehman Brothers and Mitsubishi UFJ Financial Group, that had joined forces with Morgan Stanley.
David Threadgold, a Tokyo-based analyst at Fox-Pitt Kelton, said: Daiwa will be a weaker business trying to survive as an independent company with competitors that have mostly strengthened. MUFG is putting Mitsubishi UFJ Securities together with Morgan Stanley Japan, Nomura has beefed up with Lehman and Daiwa’s old partner will now be a competitor, reported the news agency.