HSBC targets £1.5bn stake in Japanese consumer finance giant

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HSBC, Britain's largest bank, is attempting to make a major move on the Japanese banking market by talking to the consumer finance giant Takefuji about taking a £1.5bn stake in the business.

HSBC, Britain's largest bank, is attempting to make a major move on the Japanese banking market by talking to the consumer finance giant Takefuji about taking a £1.5bn stake in the business.

HSBC is one of five prospective buyers for the 33 per cent holding, worth ¥300bn, in Takefuji. The business has been struggling since its founder and former chairman, Yasuo Takei, was arrested in December on suspicion of ordering the tapping of the telephone of a journalist who had been critical of the company.

Consumer finance is a highly profitable business in Japan, in which firms lend money at a rate of interest of up to 29 per cent. As well as providing a substantial footprint in the Japanese savings and lending market, HSBC could transfer skills in consumer finance to Takefuji, which it gained when it bought America's Household International.

At the time, HSBC said it would roll-out Household's expertise in accessing credit risk to those on medium and low incomes to other countries.

HSBC would not comment on the talks with Takefuji, which are believed to be at a very early stage. Other interested buyers include Citigroup and the US fund Ripplewood, it was reported by Japan's business newspaper Nihon Keizai.

HSBC has a small corporate and investment banking presence in Japan, but does not have any exposure to its retail banking market.

News of HSBC's interest comes just a day after its ambitious plans for China emerged, when the UK-listed bank agreed to pay up to $1bn (£570m) for a 20 per cent stake in China's fifth-largest lender, the Communications Bank.

HSBC makes only 25 per cent of its profits in Britain, and its history is based as much in the Far East, especially in Hong Kong, as in the West. Sir John Bond, the chairman of the group, has laid out a five-year strategy to grow the bank aggressively, which will involve taking large stakes in the financial sectors of rapidly expanding economies, such as China's, as well as building its presence in developed countries, such as the US and UK.

Takefuji, which has a market value of about ¥1.1 trillion, said in a statement that no formal decision had been made and it could not comment on any change in ownership.

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