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Advantage Partners set to spur Tokyo Star growth

SYDNEY: Advantage Partners, the new owner of Tokyo Star, hopes to grow the regional Japanese bank through a mix of alliances and takeovers, new products, and more branches.

Richard Folsom, one of Advantage’s founders, told Reuters in an interview that both Japan’s consumer-lending shakeout and the global credit crisis presented opportunities for Tokyo Star, which his firm has bought for 248 billion yen ($2.4 billion).

Advantages plan focuses on alliances with firms who will sell Tokyo Star’s products, cross selling to existing clients and launching new products. The fund also envisions takeovers.

“We see Tokyo Star Bank as an attractive platform that may lend itself to capital ties or add-on acquisitions of other banking or financial-service firms,” said Folsom, adding nothing concrete had been decided yet.

Advantage, Japan’s biggest private equity firm is pinning its hopes on Tokyo Star’s culture of innovation — borne out of necessity as the bank emerged from Japan’s decade-long bad loans crisis under the tutelage of a foreign investment fund.

Advantage expects Tokyo Star to open 12 to 15 new bank branches in the next 2 to 3 years. The first opened on Japan’s northern island of Hokkaido this week. Folsom said last year’s stricter consumer-lending regulations could throw up growth opportunities via the purchase of customer loan portfolios from regional banks.

And he added: “The retreat of foreign banks and Japanese banks from real-estate lending to corporate clients due to the global credit crisis has created opportunities for Tokyo Star which continues to lend.” reuters

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