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BTMU diversifying business in Australia

BTMU diversifying business in Australia

(6 August 2015 – Australia)  Bank of Tokyo-Mitsubishi UFJ (BTMU), Japan’s biggest bank now has A$13 billion of loans in Australia to non-financial companies, a big jump from its early days of lending to expanding Japanese companies.

Currently BTMU’s lending includes mega-infrastructure projects such as the Port of Brisbane, toll roads Peninsula Link and Connect East, and energy deals including the Dampier Bunbury Natural Gas Pipeline.

It is also funding large mining and energy projects, including Pilbara iron ore mine Roy Hill, and the Ichthys LNG project off the north-west coast.

BTMU has been operating for 30 years in Australia and held a grand dinner at the Museum of Contemporary Art in Sydney on 4 August to celebrate.

Speaking to Fairfax Media reporters, BTMU chief executive for Asia and Oceania, Go Watanabe said many Japanese companies are looking to Australia for opportunities.

"Despite the devaluation of the yen, they are getting more aggressive looking for more opportunities to buy and invest into foreign assets and companies.

“That's a trend we will see continue. And many companies are looking for those opportunities in Australia."

In Australia BTMU plans to lift its corporate deposits as part of its liquidity management.

Deposits in Australia are about A$5 billion, but BTMU will target more by offering a cash management service to iron ore and gas projects as they come on line and start generating cash.

Domestically, BTMU has been hit with almost 25 years of low interest rates in Japan shrinking loan margins, high levels of cash in Japanese companies, and lacklustre housing markets which are holding back credit growth.

As a result, BTMU has been forced to diversify its operations by targeting services for which it can charge fees, including asset management.

The bank seeks to diversify its portfolio in Australia too, looking to healthcare, food and value-added services while bolstering its advisory work.

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