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Microcap & Penny Stocks : Tokyo Joe's Cafe / Societe Anonyme/No Pennies -- Ignore unavailable to you. Want to Upgrade?

To: DebtBomb who wrote (5110)	10/1/1998 10:33:00 PM
From: chirodoc	Read Replies (1) \| Respond to of 119973

when do we buy the big money center banks? at some point they will be a raging buy this crisis will provide opportunity p/e of cci and cmb is around 12! October 2, 1998 Citibank Credit Line for Sumitomo Reflects New Role for Foreign Banks By JATHON SAPSFORD Staff Reporter of THE WALL STREET JOURNAL TOKYO -- Citicorp's Citibank said it arranged a $600 million syndicated line of credit for Sumitomo Corp., the biggest deal so far of its kind by a foreign institution in Japan and the latest sign of how a funding shortage in Japan is presenting new opportunities for foreign banks. Citibank didn't disclose details of the deal, but said the credit line is available to Sumitomo any time the huge trading company needs short-term financing. "If there's a crisis, they've now got assurance they can get financing," says Citibank vice president Richard Magrann-Wells. "This is to demonstrate to the markets that they have no problems raising funds." Behind the deal is a growing fear that the troubles rocking Japan's banking industry will make it difficult for corporations to raise short-term financing from local banks. Japanese bankers concede privately they are having an increasingly hard time raising funds -- particularly U.S. dollars -- in money markets, thus making it tough to provide their clients with the sort of dollar financing that Citibank and its partners are offering Sumitomo. The Bank of Japan found in a survey released this week that a majority of businesses find their bankers increasingly unwilling to lend money. "Companies still have difficulty in raising funds," says Shosaku Murayama, head of the central bank's research and statistics department. "This has dampened overall business sentiment." Differences in Ratings Japanese corporations, meantime, now often find their credit ratings are higher than those of their Japanese banks. Relying on weaker banks during times of financial crisis threatens the credit rating of the borrower. Moody's Investors Service rates Sumitomo at single-A-2, but that rating is on review for a possible downgrade. Most big banks, though, have a rating that is equal or lower. Citibank's rating is higher at double-A-2. Therein lies an irony: Citibank, at this time of great financial turmoil in Japan, is seen increasingly as a rock of stability in a nation that once distrusted foreign banks. Already, Japanese depositors have been flocking to the bank, whose total deposits here jumped to $10.3 billion as of March 31, from $4.7 billion only two years earlier. Now, big corporate borrowers are turning to Citibank as well. Citibank arranged a smaller credit line for electronics giant NEC Corp. in March. The local banking system's deficiencies help explain the success foreign financial companies are suddenly having in penetrating Japan. Dai-Ichi Kangyo Bank Ltd. said Thursday it has agreed to a new asset-management tie-up with J.P. Morgan & Co., the latest in a series of foreign companies to join in such ventures. Brokerage companies like Morgan Stanley Dean Witter & Co., Merrill Lynch & Co. and Goldman Sachs & Co. are now among the busiest stockbrokers in Japan. More Deals Expected Citibank says that, in the coming months, it will be announcing big deals in Japan involving real-estate securitization, cash management services, and more syndicated loan financing for big Japanese borrowers. Sumitomo may never have to tap its new credit line. What Sumitomo gets, by paying an undisclosed fee, is a backup funding source. "We don't have any problems raising money from Japanese banks right now," says an official at Sumitomo. "But it is much safer to have this, just in case." Other members of the syndication are Banque Nationale de Paris, Paribas, Barclays Bank PLC, Credit Agricole Indosuez, National Australia Bank Ltd., Westdeutsche Landesbank Girozentrale and Societe Generale.