Hitachi and four regional banks agree to establish joint venture to consolidate financial back-office operations

Hitachi, Ltd. announced that it has agreed with Chiba Bank, Daishi Hokuetsu Bank, Toho Bank, and North Pacific Bank to establish a joint venture, TSUBASA Joint Administrative Center Co., Ltd., aimed at consolidating back-office operations for financial institutions. Based on the agreement, Hitachi and the four banks plan to establish the company in July 2026 and aim to begin operations in April 2027. The joint venture will jointly build a system platform that allows the four investing banks to conduct back-office operations such as fund transfers, account transfers, seal verification, and inheritance procedures in a shared environment. By dividing roles among the banks, the company will promote operational consolidation, improve efficiency, reduce system costs, and optimize human and financial resources. For inheritance-related operations, a new business system will be developed on the shared platform and is scheduled to begin operation in the first half of fiscal 2027. This is expected to enable full paperless processing across inheritance procedures at each financial institution. Hitachi will provide platform construction and operation services as well as business systems to the joint venture, while also participating as an equity partner. Drawing on its experience in building mission-critical systems for financial institutions, Hitachi plans to gradually promote autonomous operations through AI agents in the future and create an AI-native environment where people and AI collaborate. Through this initiative, Hitachi aims to help improve the profitability of the participating banks and contribute to sustainable development, including regional economies. Regional financial institutions in Japan face changes such as population aging, declining birthrates, and population concentration in urban areas. As a result, they urgently need to secure personnel, improve operational efficiency, optimize costs, and concentrate management resources on high-value-added services. However, essential back-office work such as transaction processing and administrative management is currently operated separately by each financial institution, requiring individual human and financial resources and limiting the ability to shift resources toward higher-value work. To address these challenges, Chiba Bank, Daishi Hokuetsu Bank, Toho Bank, and North Pacific Bank have been studying back-office consolidation under the TSUBASA Joint Administrative Center concept, and have decided to establish the joint venture with Hitachi, which has supported many financial institutions through mission-critical system services. The joint venture will provide and operate both shared services and a common platform for back-office operations including fund transfers, account transfers, seal verification, and inheritance procedures. It will act as the operating entity coordinating among the banks and promoting the standardization of systems and business processes. First, a common administrative processing environment will be built on Amazon Web Services (AWS) as the shared platform. This will enable the four banks to entrust and receive work from one another, divide tasks according to their respective strengths, and realize consolidated back-office operations. For inheritance procedures, a new business system will be developed on the shared platform. After launch, it will enable not only the unification of administrative rules among the banks, but also end-to-end paperless handling from document checks after reception through final processing such as transfers. Going forward, the service is expected to expand to other regional financial institutions facing similar issues, including banks participating in the TSUBASA Alliance. The TSUBASA Alliance, launched in October 2015, is a broad regional financial institution partnership involving 10 banks: Chiba Bank, Daishi Hokuetsu Bank, Chugoku Bank, Iyo Bank, Toho Bank, North Pacific Bank, Musashino Bank, Shiga Bank, Bank of the Ryukyus, and Gunma Bank. The joint venture will be named TSUBASA Joint Administrative Center Co., Ltd. and will be located at 1-2 Chibaminato, Chuo-ku, Chiba City, Chiba Prefecture, the location of Chiba Bank’s head office. Its representative will be decided later. Capital will be 60 million yen, with an additional 60 million yen in capital reserve. Ownership will be Chiba Bank at 54.2%, Hitachi at 15.8%, and Daishi Hokuetsu Bank, Toho Bank, and North Pacific Bank at 10.0% each. Its business will include contracted back-office administrative work and provision of systems owned by the joint venture as services. Establishment is planned for July 2026, operations for April 2027, and release of the inheritance system for the first half of fiscal 2027. Hitachi will build and operate the shared platform that serves as the joint venture’s core system, and through its investment will contribute to future operational advancement by identifying and supporting challenges faced by regional financial institutions. Hitachi also plans to combine domain knowledge gained through back-office standardization with advanced technologies to further support operational efficiency and the optimization of human and financial resources. Its concept includes using AI agents to gradually make operations autonomous and converting tacit knowledge into explicit knowledge, creating an AI-native environment where people and AI collaborate beyond simple back-office standardization. To realize this vision, Hitachi plans in the future to provide the joint venture with HMAX Finance, one of the HMAX by Hitachi next-generation solutions designed to transform social infrastructure with AI. By combining AI with its long-standing expertise in supporting mission-critical financial systems, Hitachi aims to help resolve personnel shortages at each bank, optimize the allocation of human and financial resources to high-value-added operations, improve profitability, and contribute to sustainable development including regional economies.