By Kentaro Otsuka and Shinichi Ikeda / Yomiuri Shimbun Staff Writers

Makoto Kobayashi, president and CEO of Mitsubishi UFJ Morgan Stanley Securities Co., said that he aims to "incorporate Morgan Stanley's advanced initiatives" into his company, during an interview with The Yomiuri Shimbun.

Mitsubishi UFJ Financial Group Inc. $(MUFG)$ holds a majority stake in the securities company.

In 2008, MUFG invested in U.S. financial services company Morgan Stanley following the collapse of Lehman Brothers. This gave the two companies the opportunity to jointly launch and invest in two securities companies in 2010 -- Mitsubishi UFJ Morgan Stanley Securities and Morgan Stanley MUFG Securities Co.

Kobayashi, 63, spoke about what MUFG has achieved through its collaboration with Morgan Stanley.

The following are excerpts from the interview.

The Yomiuri Shimbun: What has enabled the major financial groups from Japan and the United States to sustain their collaborative relationship?

Makoto Kobayashi: Morgan Stanley tends to use the phrase "spirit partnership." As described in this phrase, we both have a strong desire to understand each other and create things together. This sentiment has been passed down at MUFG, even through changes in president from (Nobuyuki) Hirano to (Kanetsugu) Mike to (Hironori) Kamezawa. MUFG and Morgan Stanley hold a steering committee twice a year, once in Tokyo and once in New York, in which there are heated exchanges of opinions about what is progressing, what isn't working and whether there are new areas for cooperation.

Looking at the field of investment banking (which includes mergers and acquisitions), MUFG's extensive network (in Japan) and Morgan Stanley's strength in global M&As complement each other well. Our clients in Japan are reaping the benefits of Morgan Stanley's expertise. As a result, we have overwhelming strength in cross-border M&As and raising global capital.

Yomiuri: What is needed to deepen collaboration between MUFG and Morgan Stanley? Are there any overlapping areas between Mitsubishi UFJ Morgan Stanley Securities and Morgan Stanley MUFG Securities?

Kobayashi: There are more areas in which we can collaborate. In 2023, we announced our "Alliance 2.0," which represents a new partnership framework between MUFG and Morgan Stanley. In 2024, we consolidated our sales operations of Japanese equities for institutional investors. Morgan Stanley is interested in whether there is room in Japan to expand its wealth management activities, which has become an important part of its operations.

We've thoroughly streamlined overlapping areas (of the two companies), so there is currently no need to alter the overall framework. Regarding personnel exchanges, we have maintained a system to dispatch workers to Morgan Stanley (from Mitsubishi UFJ Morgan Stanley Securities). We aim to obtain (Morgan Stanley's) expertise in wealth management, just like we have already done in the field of investment banking. Our employees tend to handle wealth management services individually as private bankers, while members of Morgan Stanley operate in teams. That's something we should learn. In fact, we've been inviting financial advisors from Morgan Stanley to provide lectures.

Yomiuri: Some experts say that the presence of Mitsubishi UFJ Morgan Stanley Securities is relatively weak in M&As and initial public offerings (IPOs) for small and medium-sized companies, including startups. What is your view on the matter?

Kobayashi: Despite personnel limitations, we were able to be involved in eight domestic M&As in fiscal 2024 that rank in the top ten by transaction value. Regarding startups, I believe that the number of deals we cover will increase, as standards for maintaining a listing status at Tokyo Stock Exchange's Growth Market will become stricter. Going forward, we will aim to secure more small and medium-sized deals.

Regarding IPOs, we don't just simply recommend companies to go public at an early stage. Instead, we advise companies to obtain the help of institutional investors to achieve sufficient liquidity before listing, so that they will be able to raise capital afterward that contributes to their growth. Our goal is not simply to achieve a certain number of IPOs.

Yomiuri: What is the future vision for the company?

Kobayashi: If I talk about MUFG as a whole, it conducts various asset management services at (online securities company) Mitsubishi UFJ eSmart Securities Co. and Mitsubishi UFJ Trust and Banking Corp. We want to effectively promote such services in an integrated manner to our clients and further strengthen our revenue streams, which are already stable. I believe Japan's securities business will continue to develop. Within this context, it is essential that each group company makes efforts in areas such as digital technology and artificial intelligence.

For Mitsubishi UFJ Morgan Stanley Securities, it is essential to incorporate Morgan Stanley's advanced initiatives.

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This article is from The Yomiuri Shimbun. Neither Dow Jones Newswires, MarketWatch, Barron's nor The Wall Street Journal were involved in the creation of this content.

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October 21, 2025 22:00 ET (02:00 GMT)

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