Citigroup will further increase its investment banking team in Japan to capitalize on a record-breaking boom in mergers and acquisitions that it expects to reach new heights.
The U.S. bank plans to expand the division about 30% by the first half of 2026, Japan Vice Chair Masuo Fukuda said in an interview, declining to give a headcount figure.
Japanese companies have become more open to deals following corporate governance reforms that have made executives and directors more attuned to shareholders¡¯ needs. Some firms are selling non-core assets while others are pursuing acquisitions to boost growth opportunities abroad. Hostile takeovers are no longer taboo, and private equity and activist investors are playing a greater role.
¡°This is a major turning point for the Japanese market,¡± said Akira Kiyota, who joined Citigroup Global Markets Japan from Nomura in October as co-head of investment banking in Japan. The increase in number and complexity of deals means ¡°the need for financial advisers is growing, and our role will continue to expand,¡± he said.
M&A deals involving Japanese companies are approaching $350 billion this year, the most since Bloomberg began collecting the data in 1998. Citigroup ranked 10th among advisers on such transactions and 11th for underwriting Japanese equity and equity-linked deals.
Citigroup isn¡¯t the only global firm that¡¯s rushing to strengthen investment banking operations in Japan. Goldman Sachs revamped its M&A advisory operations this month. Jefferies and UBS have also made key appointments.
¡°The competition for talent is intensifying, requiring us to move fast with recruitment,¡± Fukuda said. In March, he said he wanted to grow the investment banking team by 15%. The firm¡¯s Japan securities unit has about 900 employees.
Citigroup¡¯s Japan investment banking business is expected to post its highest annual revenue since the firm severed ties with local brand Nikko in 2009, according to the division¡¯s other co-head, Taiji Nagasaka.
When asked about the outlook for the Japanese market in 2026, Kiyota said external factors and various pressures mean that companies would ¡°have no choice but to pursue corporate actions.¡±
The Bank of Â鶹´«Ã½ decision last week to raise benchmark interest rates to a 30-year high of 0.75% is unlikely to slow deal activity, he added.
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