Bank of Japan Chairman Jun Ohta dies at the age of 65

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Jun Ohta, CEO of Sumitomo Mitsui Financial Group and a driving force behind the bank’s recent expansion wave in the United States and Southeast Asia, has died at the age of 65.

Ota’s death last week, which the company announced on Monday, follows a four-year stint at the top of SMFG, Japan’s second-largest bank by market value, after a career that rose through the ranks.

In addition to building a recent reputation for aggressive foreign expansion, Ohta led the financial group through one of its most painful recent episodes: a scandal at its brokerage unit, SMBC Nikko, over alleged market manipulation.

The scandal, which led to multiple arrests and the ongoing prosecution of several executives and traders, centered on block trades and the way information was improperly passed between SMFG’s main banking division and its brokerage unit.

In November 2022, Ohta joined SMBC Chairman Nikko in offering a formal apology at a press conference after the Financial Services Agency issued a business improvement order.

As with many bankers of his generation, Ohta spent most of his career navigating through a long period of economic stagnation and contraction in Japan, when many companies learned to rely less on bank loans. Japan’s population also began to shrink, forcing banks to look for growth abroad.

Ota, who spent part of his career in Singapore after joining the bank in 1982, was part of SMFG’s senior leadership that pushed for expansion into India, Indonesia and other Southeast Asian economies.

His move to expand SMFG’s footprint on Wall Street centered on an alliance with Jefferies Financial Group in 2021, with SMFG agreeing to acquire a 4.9 percent stake in the US group.

This year, SMFG said it plans to triple the size of its stake by buying Jefferies shares on the open market.

SMFG’s alliance with Jefferies is part of a broader effort by Japan’s largest banks to capture more of the lucrative business available in the United States. During the 2008 financial crisis, Japan’s largest banking group, Mitsubishi UFJ, formed an alliance with Morgan Stanley that blossomed into one of the country’s most powerful forces in investment banking.

This year, Mizuho Bank, Japan’s third-largest bank, announced the purchase of Wall Street M&A consultancy Greenhill in an attempt to keep up with its rivals.

SMFG said it would decide on a successor to Ota in due course, and that Vice President Toru Nakashima would in the meantime become acting CEO.