The United States’ Federal Deposit Insurance Corporation has given Toyota approval to operate banking services in the US, a development which will allow it to strengthen financial services.
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A Toyota spokesman told Dow Jones that the group’s US subsidiary, Toyota Financial Services Americas Corp., applied for a banking licence in the state of Nevada in late 2002 and received FDIC approval on January 30.
The report said the US subsidiary now plans to set up a new wholly owned unit, Toyota Financial Savings Bank, which will be capitalised at $US10 million with five board members.
It added that the new banking unit will focus on car sales-oriented financial services to customers and car dealers, such as cash management services for dealers, but won’t conduct a full-fledged banking business including services such as mortgage finance, which its US rivals do [and increasingly rely on as a profit source].
Dow Jones noted that, in its nativeJapan, Toyota already offers a wide range of financial services, including credit card and securities businesses.
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By GlobalDataThe Toyota group’s financial services division aims to boost its operating profit to around Y100 billion by March 2005 from Y30.3 billion in the fiscal year ended March 2003, the report added.
