Aichi Financial, San ju San Financial Agree to Pursue Merger in 2027
Aichi Financial Group (TYO:7389) and San ju San Financial Group (TYO:7322) agreed to pursue a business integration through a merger targeted for April 2027, creating a regional banking group with combined assets of about 11.6 trillion yen, according to a Thursday filing on the Tokyo Stock Exchange.Shares of Aichi Financial fell more than 1%, while San ju San's shares slipped almost 4% in recent trading.The companies said they signed a basic agreement to proceed with discussions on the integration, which is expected to strengthen their presence across Japan's Tokai region, including Aichi and Mie prefectures.The combined entity would have about 10 trillion yen in deposits, 8.2 trillion yen in loans, more than 5,000 employees and 362 branches, according to presentation materials released Wednesday.The companies said the integration is intended to improve competitiveness as regional lenders face demographic challenges, intensifying competition and growing digitalization demands.The transaction is expected to be structured as an absorption-type merger between the holding companies, though the surviving entity has not yet been determined.The companies plan to sign a definitive agreement in September, seek shareholder approval in December and complete the merger on April 1, 2027, subject to regulatory approvals.