ORIX Announces Capital Participation in Major Mongolian Financial Group
- First Participation in Financial Services Business in Mongolia -
TOKYO, Japan - May 23, 2013 - ORIX Corporation (TSE: 8591; NYSE: IX), a leading integrated financial services group, today announced that it has reached basic agreement on capital participation via the purchase of approximately 16% of shares in the major Mongolian financial group TenGer Financial Group (hereinafter, "TFG"). Moving forward, ORIX will proceed to obtain the necessary permits in view of investment in June this year.
Established in 2001, TFG is a major financial services holding company offering banking, leasing, insurance and investment banking services mainly in Mongolia. Its main subsidiary Xac Bank is Mongolia's fourth largest commercial bank in terms of assets and has a robust customer base comprised mainly of small and medium sized mining and construction related businesses and individuals. In addition, as further development is expected in the Mongolian financial services market, TFG is expanding its business into an integrated financial group while strengthening its already existing leasing and insurance businesses.
Through this capital participation, ORIX intends to expand into the Mongolian financial services business with TFG as a strategic partner. ORIX will consider expanding into new areas of business such as card loans and Internet banking and use the financial services business knowhow it has cultivated over the years to expand and strengthen TFG's existing businesses. In addition, ORIX will capitalize on TFG's business platform to obtain new investment opportunities and expand its assets within Mongolia.
Growth of Mongolia's mining and agriculture industry is fast pace and with a forecasted average yearly economic growth rate of 20% over the next 5 years, Mongolia boasts one of the world's highest economic growth rates*1.
As one of the few countries in the world with large natural mining resources, the Mongolian government is laying out a policy to use private capital including foreign capital. Moving forward, rapid expansion of mainly primary industry markets is expected as a result of infrastructure development for the transportation of natural resources from mining and agriculture.
Looking ahead, ORIX will continue to promote active investment in Asian markets with the potential for growth.
*1 . Reference IMF World Economic Outlook Databases (October 2012)
ORIX Corporation (TSE: 8591; NYSE: IX) is an integrated financial services group based in Tokyo, Japan, providing innovative value-added products and services to both corporate and retail customers. With operations in 28 countries and regions worldwide, ORIX’s activities include corporate financial services, such as leases and loans, as well as automobile operations, rental operations, real estate, life insurance, banking and loan servicing. For more details, please visit our website at: http://www.orix.co.jp/grp/en/