Sumitomo Trust says to buy Citi's Nikko Asset for $1 bln

TOKYO, July 30 (Reuters) - Sumitomo Trust & Banking 8403.T, a major Japanese trust bank, said on Thursday it will buy Nikko Asset Management from Citigroup (C.N) for 112.4 billion yen ($1.2 billion).

Nikko Asset is Japan's third-largest mutual fund manager.

Separately, Sumitomo Trust said it will raise 109 billion yen through the issuance of preferred shares to strengthen its financial base.

($1=94.91 Yen) (Reporting by Yumiko Nishitani)