Feature Article Regional banks’ overseas development support strategies 2
A cornerstone of Kanagawa Prefecture for a century, the Bank of Yokohama celebrated its 100th anniversary in 2020. One of Japan’s largest regional banks, it is based in the port city of Yokohama, a flourishing international gateway since the mid-nineteenth century.
Through business integration with Higashi-Nippon Bank, it established Concordia Financial Group in 2016. Then in 2023, the bank acquired the Kanagawa Bank as a consolidated subsidiary. While generating synergy through these mergers, the bank is expanding its size and influence.
In the past, the overseas expansion of the bank’s client base of MTEs and SMEs was primarily as subcontractors of major manufacturers, such as automakers. However, in recent years more companies are looking at overseas expansion to capture demand from local growth markets and secure human resources.
Director and Managing Executive Officer ARAI Tomoki says, “There are an increasing number of MTEs and SMEs seeking to expand overseas due to the various challenges they face in Japan, such as labor shortages and business succession issues.”
A Yokohama specialties exhibition held at a Japanese supermarket in Hong Kong. The aims were to attract tourists and raise awareness of Kanagawa Prefecture’s food brands.
Vietnam is becoming a particularly popular destination. Although the bank does not have a permanent office there, it has posted a representative to both Hanoi and Ho Chi Minh City to provide detailed onsite support.
According to ARAI, India is another emerging target market due to its burgeoning population and economy.
“India continues to grow, and its immense potential is evident. I recently visited the country, where I checked out the capital, New Delhi, and Chennai, a southern city where many automotive-related companies are setting up their businesses. The living environment is clearly challenging. We have not yet established a permanent base there, but to gather more in-depth information, we are considering the possibility of sending a representative there, as we have done in Vietnam.”
The bank is also strengthening its cooperation with JBIC. This includes establishing a credit line for supporting the overseas expansion of MTEs and SMEs, enabling the bank to rapidly respond to their financing needs. It has also seconded staff to JBIC for extended periods.
“The experiences our employees gain at JBIC, where they regularly engage in international operations, are superb for human resource development.”
While strengthening its support for emerging markets and bolstering its organizational structure, the Bank of Yokohama is preparing for the next 100 years. It remains committed to addressing the challenges facing the Keihin region (the economic and industrial area stretching from Tokyo to Yokohama) and contributing to its internationalization.
