Euromoney, October 2018
Nobuyuki Hirano is the world’s most recognized and most respected Japanese banker – and the chief executive of MUFG is an articulate voice on the demographic challenges facing Japanese banking and society. He believes he has charted a path through those challenges and is an internationalist in outlook. His aim is to make MUFG the world’s most trusted financial institution. Can he succeed?
An elderly, shrinking population with plenty of savings and a steadfast unwillingness to spend them. Negative interest rates and 10-year government bonds that yield exactly nothing. Companies that do not need to borrow and have to be coaxed to spend on anything that might require billable advice. Welcome to banking in Japan.
Japan’s big three banks have been wrestling with these worsening problems for a decade, each of them coming up with strategies, plans and visions to make lemonade from the lemons that surround them domestically. Their decisions resonate globally: Japan is still the world’s third largest economy, and is home to four of the world’s top 20 banks by assets (the big three plus Japan Post Bank).
But the one that bears closest scrutiny is MUFG, the Mitsubishi UFJ Financial Group. It is the biggest – total assets of ¥299.1 trillion ($2.65 trillion) at the end of June, ranking top five worldwide – and it is also the one with the clearest strategy about what to do both inside and beyond Japan. Through long-standing US investments and partnerships and more recent southeast Asian acquisitions, it is the Japanese bank most embedded in the fabric of global banking, with all the benefits and challenges that entails.
More than any other financial institution in Japan, MUFG is identified with one person: Nobuyuki Hirano, president and group chief executive of MUFG and chairman of MUFG Bank. Born in Gifu in 1951, his history in the institution dates back to joining the Otemachi, Tokyo, branch of Mitsubishi Bank in April 1974, a month after graduating from Kyoto University’s faculty of law.
Globally, he is the most recognized Japanese banker, more so even than Haruhiko Kuroda at the Bank of Japan or Takehiko Nakao at the Asian Development Bank. Articulate and absolutely fluent in English, with firm views on everything from Japanese fiscal policy to US brokerage, his time on the Morgan Stanley board has brought his clear thinking and sense of strategy to a global audience.
So how is he going to fix Japanese banking?