According to reports, Sumitomo Mitsui Financial Group Inc. is currently evaluating a potential acquisition of US investment bank Jefferies Financial Group Inc. The news propelled Jefferies' stock to surge over 15% in pre-market trading on Tuesday. Sources familiar with the matter indicated that Sumitomo Mitsui has established a dedicated team to closely monitor Jefferies' stock performance, ensuring readiness to act swiftly should a suitable opportunity arise. Year-to-date, Jefferies' share price has declined by more than 36%. Last year, the bank's stock faced additional pressure after an asset management affiliate became involved in the bankruptcy proceedings of US auto parts supplier First Brands. Jefferies has not yet provided an immediate comment on the reports, and Sumitomo Mitsui has also declined to comment. The report further noted that Sumitomo Mitsui is not expected to launch an immediate takeover bid, and it remains uncertain whether Jefferies' management would be willing to sell the company while its stock price is depressed. Data from LSEG shows that Jefferies, which competes with several major Wall Street firms as an independent investment bank, currently holds a market capitalization of approximately $8.17 billion. In contrast, Sumitomo Mitsui Financial Group boasts a market cap of around $124 billion. Previously, Jefferies' credit standards and risk appetite came under intense market scrutiny following the bankruptcies of UK lender Market Financial Solutions and First Brands. Investors have since filed lawsuits against the investment bank, alleging fraudulent conduct related to the solicitation of investments into funds connected to First Brands. First Brands still owes approximately $715 million in receivables to Jefferies' Leucadia Asset Management division.