Resona Holdings, Inc. : disposal of subordinated loans

News Release

Date: June 8, 2007

Statement by the Governor

1.

Resona Holdings, Inc. made a request to redeem a part of its own subordinated loans subscribed by the Resolution and Collection Corporation (RCC) in accordance with the Law Concerning Emergency Measures for Early Strengthening of Financial Functions (“Early Strengthening Law”).

2.

Based on “Immediate Guideline for disposal of preferred stocks, etc. through Capital Injection with Public Funds” announced in October, 2005, Deposit Insurance Corporation of Japan (DICJ) considered the request and found it appropriate to give its approval to the request for the redemption in view of the followings;

 
  • Soundness of management of the financial institutions
  • Avoiding public costs
  • Financial system stability

Therefore, the DICJ approved the request made through the RCC as DICJ considered the transaction was in line with the policy of early disposal under Early Strengthening Law. The details of the sales are as follows:

 

 ・ Outline of the loan

Subordinated loan Resona Holdings, Inc. perpetual subordinated loan
(unlimited subordinated loan contract )
Lending Date March 30, 1999
Amount of the loan 80 billion yen (Initial injection 100 billion yen)
Interest Rate The end of March, 2009 : 6 months yen LIBOR+1.04%
On and after April, 2009 : 6 months yen LIBOR+2.54%
 

·  Outline of the disposal

Disposed Book Value 35.0 billion yen
Accumulated Total
Amount of Disposal
35.5495 billion yen (with the exception for accrued interest)
Scheduled Date of
Disposal
June 13, 2007
Residual Amount
after Disposal
45.0 billion yen
(Note) As a result of this disposal, the outstanding of public funds to Resona Holdings, Inc. on the initial injection basis, amounts to 1,998.9 billion yen (preferred stock) and 293.7 billion yen (common stocks) as well as the above mentioned subordinated loans (45.0 billion yen).

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