Two leasing companies in the Mitsubishi corporate group are negotiating terms of a merger that may take place this fall, sources said Wednesday.
The merger of Diamond Lease Co. with Ryoshin Leasing Corp. would make Japan's third-largest leasing firm, after Orix Corp. and Long-Term Credit Bank of Japan affiliate Japan Leasing Corp.
Diamond, a Bank of Tokyo-Mitsubishi affiliate, and Ryoshin, a Mitsubishi Corp. unit, are mulling merging in order to strengthen their financial standing, according to the sources.
As of March 31, 1998, Diamond and Ryoshin had about 520 billion yen and 120 billion yen in leasing assets, respectively.
The leasing industry has been left in tatters following the burst of the Japan's asset-inflated bubble economy. Most players aggressively diversified into real estate lending but were left neck deep in bad loans when the bubble collapsed in the early 1990s.