Softbank Starts Online Banking Service in Japan

TOKYO (04/11/2000) - Aggressive Internet investment firm Softbank Corp. took its first steps into the world of banking today with the launch of an online banking service, although it is keeping in mind a plan to form a bank of its own.

The new service, the Suruga Bank Softbank Branch, is a venture between Suruga Bank Ltd., a mid-size regional bank based in Shizuoka, and Softbank wholly-owned subsidiary Softbank Finance Corp. Together, the two companies aim to bring Suruga's banking operations to customers nationwide via the Internet, i-mode Internet-capable cellular telephones and telephone banking.

Initial services include both deposit and savings accounts, loans and credit cards, and the company is doubling the normal interest rate on savings -- something it says it can afford to do because of the savings it will gain from having no network of brick-and-mortar branches. Customers of the bank can use a nationwide network of ATMs (automated teller machines) to get at their money.

The tie-up will give Softbank some much-needed experience in online banking operations ahead of a planned takeover of Nippon Credit Bank (NCB), a collapsed bank currently under Japanese government control. Softbank leads a group that includes Tokio Marine & Fire Insurance Co. and leasing company Orix Corp. It has been given priority rights until April 30 to negotiate to take over the bank and is currently putting together a deal.

Softbank has been a keen investor in online financial service companies, and its roster of group companies in Japan includes stock brokerage E-Trade Securities Co. Ltd., consumer loan issuer E-Loan Japan Co. Ltd., credit card issuer E*NetCard Co. Ltd., financial advice provider E-Advisor Ltd. and insurance broker InsWeb Ltd.

The new online bank can be found on the web at http://www.surugabank.co.jp/softbank/. Softbank, based in Tokyo, is online at http://www.softbank.co.jp/. Suruga Bank, in Numazu, Shizuoka, is online at http://www.surugabank.co.jp/.

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