Japan’s Mizuho Bank Eyes Cash-Strapped Millionaires to Grow Wealth Unit Clients

Mizuho will almost double its wealth management clients by attracting newly-minted millionaires who are low on cash and in need of new finance, Bloomberg writes.

Mizuho, the third-largest bank in Japan, wants to get 1,000 families on board with its wealth unit by this time next year.

Currently there are 600.

The growth is likely to come from loans for startup companies whose equity holdings have seen boosts in value following initial public offerings, but whose cash income is still just modest.

Masayuki Sakai, general manager of the bank’s wealth management strategic project team, said in a recent interview that there are many people who don’t own their homes, and many need cash for business expansion and investing in other ventures.

“We would like to respond to their funding needs in a timely manner,” he said, according to the report.

He added that around 90% of profit in wealth management comes from business owners, and its main clients are families with over 3 billion yen, or $25 million, in assets.

This push into wealth management, Bloomberg writes, shows that there’s more competition as of late in the market. Mitsubishi and Sumitomo Mitsui have also positioned their businesses strategically lately, with ultra-low interest rates cutting into profits from traditional lending.

Mizuho also recently led a group investment of around $200 million in Vietnam’s M_Service, which operates the MoMo app.

Related: Vietnamese FinTech App MoMo Reaches $2B Valuation with Mizuho Investment

That, according to the PYMNTS report, put the company’s value over $2 billion.

Ward Ferry Management and existing shareholders Goodwater Capital LLC and Kora Management also participated in the fundraising.

With the new capital, MoMo will bolster its market position and make its product better, the report notes, and it plans to increase its investments in technology and support digital transformations for mergers and acquisitions in smaller business. However, there are currently no plans for an IPO.