To support Japanese small and medium sized enterprises penetrate further into Southeast Asia, DBS has signed an agreement with a Kyushu headquartered bank.
DBS, Southeast Asia’s largest bank, and Nishi-Nippon City Bank (NCB) formally inked a memorandum of understanding (MOU) in Singapore.
As the Bank of Japan's negative rate policy continues to squeeze on the lending business at home, Japanese regional banks are looking offshore. With a limited capacity to expand their overseas footprint independently however MOU's with strong local players have become a popular option.
According to the MOU, both banks will act as primary advising banks to letters of credit issued by each party and offer discounting of export bills.
DBS will also issue bank guarantees such as performance and bid bonds on the back of a counter bank guarantee from NCB.
Southeast Asia Japan's Business Hinterland
In addition, DBS will provide investment banking and corporate finance advisory services to NCB corporate customers who are seeking to raise funds either through a primary or secondary listing on the Singapore Exchange.
Small and mid-sized Japanese companies, the main customers of regional banks like NCB, are making bigger inroads overseas, particularly into ASEAN countries.
«The partnership with DBS will help us better serve our SME clients who are expanding their business in Asia,» said Hiromichi Tanigawa, President of NCB.
