Friday, August 20, 1999 Published at 06:40 GMT 07:40 UK
Business: The Company File
Merger creates world's biggest bank
The headquarters of Fuji Bank in Tokyo
Three leading Japanese banks have announced an alliance forming the world's largest financial group.
Fuji Bank, Dai-Ichi Kangyo and the Industrial Bank of Japan say their operations will be integrated by the spring of 2002.
The merger has given rise to fears of widespread redundancies, and it is understood the three plan to cut 6,000 jobs over the next five years, with the closure of 150 of their combined 704 branches.
Reorganisation is expected to concentrate on the retail, corporate, investment banking and brokerage services.
Shares in the three banks surged by about 10% after the announcement.
IBJ closed up ¥100 at ¥1,084; DKB also rose ¥100 yen to ¥1,009; and Fuji Bank ended up ¥90 at ¥1,043.
The merger is part of a wave of consolidation in the country's financial sector following the 1990s recession, which left many banks with large bad debts.
There have been several tie-ups in recent months, largely in response to the difficulties the sector has been facing.
Fuji and DKB last year agreed an alliance in trust banking, which mainly involved the management of pension funds.
Earlier this year, Fuji also took over a smaller trust bank, Yasuda Trust and Banking Co.
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