UPDATE 1-Japan’s Resona to pay back $4.7 bln public money

* Says to spend Y425.7bln to pay back Y400bln public money

* The bank will still have Y1.7trln public fund after payback
(Recasts, adds details)

TOKYO, Aug 26 (BestGrowthStock) – Resona Holdings (8308.T: ) said it
would pay about $5 billion to buy back its preferrred shares,
handing the government a profit of $304 million on part of the
public money used to bailout the Japanese lender in 2003.

Japan’s fourth-largest bank said it would pay 425.7 billion
yen ($5 billion) for the buyback, which represents a 6.4 percent
premium to the shares’ book value of 400 billion yen, netting the
state 25.7 billion yen.

Resona will still owe the government about 1.7 trillion yen
from bailouts received in the late 1990s and when it was
effectively nationalised in 2003 after nearly collapsing under a
mountain of bad loans.

The bank said it does not have specific plans for paying back
the rest of the public money, adding that it needs to reserve
enough capital to maintain a Tier one capital ratio – a measure
of high-quality capital — of about 8 percent.

Resona said the buyback would cut its Tier one ratio by 2.17
percentage points from 10.84 percent as the end of June.
(Reporting by Taiga Uranaka; Editing by Chris Gallagher and
Nathan Layne)

UPDATE 1-Japan’s Resona to pay back $4.7 bln public money