The government-backed Deposit Insurance Corp. plans to split up the operations of Niigata Chuo Bank, a collapsed second-tier regional bank based in Niigata Prefecture, ahead of its sale to three regional banks in the prefecture, financial industry sources said Thursday.
Senior DIC officials have already started discussing the plan with executives of the three banks -- Daishi Bank, Hokuetsu Bank and Taiko Bank, the sources said.
Niigata Chuo was declared insolvent in October by the Financial Reconstruction Commission, which subsequently appointed the DIC as the bank's administrator.
As the sale of Niigata Chuo to the three banks is seen as a necessary measure to ensure the stability of Niigata's economy, the DIC intends to name them as the purchasing parties in April or May, the sources said.
Daishi is based in Niigata city, while Hokuetsu and Taiko have head offices in Nagaoka.