4. Deciding on the merger between Sumitomo Bank and Sakura Bank

In August 1999, Dai-Ichi Kangyo Bank, Fuji Bank, and the Industrial Bank of Japan announced a full merger, sending shock waves through the financial industry. The integration of these three banks implied that the created gigantic bank would have an overwhelming share of the domestic market. Also, by this merger, only a limited number of large financial institutions were left for a possible merger to pursue an expansion in asset volume. A selection for merger partner could significantly change the future trajectory of each financial institution.

On August 23, shortly after the three banks announced the merger plan, Yoshifumi Nishikawa, then president of Sumitomo Bank, and Akishige Okada, then president of Sakura Bank, had an unscheduled opportunity to get together, resulting in a meeting the following day to explore the possibility of a partnership. This was followed by a second meeting held on September 8 to engage in more detailed discussions on specific issues in consideration of the possibility of a full partnership and future integration. Sumitomo Bank and Sakura Bank signed a basic agreement on a full partnership and integration plan and held a joint press conference on October 14, 1999. The two banks made public their intent to execute the merger plan by April 2002 for full integration on an equal footing.