MUFG and Sumitomo Mitsui FG to sell Toyota stock for 1.3 trillion yen - stakeholders

Consider a phased sale using stock buybacks by Toyota

It is a symbolic move showing the acceleration of Japanese companies' policy stock reduction efforts

　　Multiple stakeholders spoke on condition of anonymity. The total amount of Toyota stock held by the two companies is 1.32 trillion yen at market value. When the holdings of the four non-life insurance companies that have set out policies to reduce policy stocks to zero are included, a total of Toyota stocks on a scale exceeding 3.2 trillion yen will be sold.

　　The total amount owned by 2 mega and the 4 Sompo Insurance companies is equivalent to about 6% of Toyota's total market value. It is said that the impact on the market will be minimized by utilizing stock buybacks by Toyota and gradually selling.

　　The movement to reduce policy stocks is spreading domestically due to reasons such as lowering capital efficiency, etc., but reduction pressure from overseas investors etc. is still strong. If the sale of Toyota stock, which is the largest company in Japan and has been delayed in resolving ties with major financial institutions such as megabanks, actually proceeds, it will be a symbolic move showing the acceleration of Japanese companies' efforts to reduce policy stocks.

　　In response to Bloomberg's report, the decline in Toyota's stock price extended to 3194 yen, which is 2.4% lower than the previous day due to afternoon trading. Meanwhile, MUFG's stock price dropped 1.7% to 1622.5 yen, and Sumitomo Mitsui FG rose 0.9% to 10,255 yen, respectively, with slight price movements.

　　According to Bloomberg data, the holding amount of Toyota stock on a market value basis (closing price on the 6th) is about 700 billion yen for Mitsubishi UFJ Bank, which is under the umbrella of MUFG, and about 62 billion yen for Sumitomo Mitsui Banking Corporation, which is under the umbrella of Sumitomo Mitsui Financial Group.

　　Regarding the sale of policy stocks, major insurance companies have set out policies to reduce holdings to zero in response to pre-adjustment issues with corporate joint insurance premiums. Assuming that one cause of the problem was policy stocks, the Financial Services Agency requested each company to accelerate sales. There was a view in the market that sales would accelerate in other industries, such as banks that hold many policy stocks, in the wake of non-life insurance issues.

　　Regarding financial institutions' policy stock reduction efforts, Financial Services Agency executives expressed recognition that the movement to eliminate policy stocks in the Japanese capital market will accelerate as stock sales of such companies proceed, assuming that companies that have been delayed in dissolution of holdings, such as Toyota, etc., are so-called “bedrock stocks.”

　　A spokesperson for Mitsubishi UFJ Bank and Sumitomo Mitsui Bank declined to comment on the sale of Toyota shares. There has been no comment from a Toyota spokesperson.