Banking News

MUFG To Exit US Retail Banking Market

MUFG To Exit US Retail Banking Market

(21 September 2021 – Japan) Mitsubishi UFJ Financial Group (MUFG) has reached a deal to sell its US banking arm MUFG Union Bank (MUB) in an $8 billion cash and share deal with US Bancorp, marking a significant strategy shift for Japan's biggest lender.

MUFG acquired Union Bank in 2008 for $3.5 billion. It currently has about 300 branches and more than $16 billion in equity capital, or book value. The deal will would give the US Bancorp about $664 billion in assets, solidifying its status as the fifth-largest retail bank in the country.

“Given MUB’s current business environment, including the need for increased technology investments as part of digital transformation, a certain scale is required to maintain and strengthen competitiveness,” said MUFG.

“The MUFG group continues to view the US market as important, even after the Share Transfer, and will aim to achieve new growth through the share ownership and business alliance with USB, as well as the concentration of management resources on corporate transactions that can leverage MUFG’s strengths,” the bank added. MUFG will focus on corporate and investment banking in the US through other units and through its partnership with Morgan Stanley.

“The acquisition of MUFG Union Bank underscores our commitment to strengthen and grow our business on the West Coast, make investments to serve customers and local communities and enhance competition in the financial-services industry,” said US Bancorp chief executive officer Andy Cecere.

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