JAPAN'S SUMITOMO MITSUI FINANCIAL PLANS BAD-DEBT CLEANUP.

AsiaPulse News, October, 2003

TOKYO, Oct 9 Asia Pulse - Sumitomo Mitsui Financial Group Inc. (TSE:8316) has teamed up with Goldman Sachs Group Inc. to finalize its plan to speed up the effort to dispose of its nonperforming loans.

While Sumitomo Mitsui Banking Corp., Goldman Sachs and the Daiwa Securities SMBC group will establish a firm that will help Sumitomo Mitsui's troubled borrowers, the bank will sell 1 trillion yen (US$9 billion) in nonperforming loans on a book value basis to a fund that the three partners will set up.

Goldman Sachs and the Daiwa Securities SMBC group will contribute 58 per cent and 29 per cent, respectively, of the capital for the fund. Because the bank's stake in the fund will be held to just 13 per cent, once the loans are sold, they will no longer be...