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Sumitomo Mitsui Financial, Resona make progress in 3 regional bank units' merger

Japanese regional lender Minato Bank Ltd. will cease to be a consolidated subsidiary of Sumitomo Mitsui Financial Group Inc. as part of the bank's plan to consolidate its regional banking units in Japan's Kansai region with Resona Holdings Inc.'s Kinki Osaka Bank Ltd.

Following Resona's tender offer for the common shares of Minato Bank, the bank will no longer be Sumitomo Mitsui Financial's subsidiary and will be its equity method affiliate on Feb. 20. Sumitomo Mitsui Financial will hold 34.78% of voting rights in Minato Bank following the change, down from 46.42% of voting rights as of March 31, 2017.

Resona and Sumitomo Mitsui Financial entered into a final agreement in September 2017 to merge their regional banking units in the Kansai region. The companies plan to consolidate the banks under an intermediate holding company by April.

In addition, Kansai Urban Banking Corp. will cease to be a consolidated subsidiary of Sumitomo Mitsui Financial and will be its equity method affiliate by March 31, the end of the fiscal year. In relation to Sumitomo Mitsui Banking Corp., Minato Bank and Kansai Urban Banking will also cease to be consolidated subsidiaries of Sumitomo Mitsui Banking and be its equity method affiliates as of Feb. 20.

Sumitomo Mitsui Financial said the impact of the planned consolidation on its fiscal year results is still under review.