Biggest bank in Japan set to raise $11bn

JAPAN&rsquo;S biggest bank Mitsubishi UFJ Financial Group (MUFG) is set to launch the biggest-ever cash call by a Japanese financial firm.<br /><br />Mitsubishi is believed to be preparing to issue about $11bn (&pound;6.6bn) in new shares to meet stricter capital requirements and boost lending in Asia. The share issue of about one trillion yen is believed to represent a record for a Japanese financial firm.<br /><br />MUFG is understood to be planning to issue the shares by the end of the year.<br /><br />Japanese banks have already raised $15bn this year by issuing&nbsp; shares, but have been tipped to tap resurgent equity markets for more as worldwide regulators plan new rules obliging them to hold more capital.<br /><br />Leading industrial and emerging market countries agreed in September to finalise new capital rules by the end of 2010 and to try to&nbsp; implement tougher capital rules for banks by the end of 2012.<br /><br />Japanese banks have previously raised funds by issuing preferred securities and preference shares, but neither of these count toward core tier-1 capital, a measure of high quality capital against risky assets likely to be the norm under new global rules.<br /><br />MUFG also wants a firmer capital base to boost lending to companies in fast-growing Asian economies, a key part of its overseas growth strategy.<br /><br />The bank could officially file&nbsp; for the issue on November 18, when it is due to report interim earnings.<br /><br />An MUFG spokesman declined to comment.<br /><br />MUFG raised 800 billion yen in December by issuing common and preferred shares to replenish its capital after suffering from falls in the value of its share portfolio and making a $9bn investment in US bank Morgan Stanley.