Japan's MUFG says to close branches, cut jobs

TOKYO (Reuters) - Mitsubishi UFJ Financial Group (8306.T), Japan's biggest bank, said on Monday it plans to close 50 branches and cut 1,000 jobs to continue slimming down its operations since its merger in 2005, as a tumbling stock market depletes its earnings.

MUFG, along with other Japanese banks, has escaped much of the subprime damage that hammered its Western rivals, but it has since been hit by a recession and a sharp fall in domestic stocks.

The bank booked its first quarterly net loss and slashed its full-year forecast in February, and said this month it would raise nearly $1 billion in its latest step to shore up its capital base.

MUFG spokesman Takashi Miya said the bank, created through the merger of Mitsubishi Tokyo Financial Group and UFJ Group, would press forward with restructuring in the next three years to reduce operations that were duplicated by the merger.

It plans to shut about 50 more branches, close 200 ATMs, cut 1,000 jobs through attrition and relocate 1,000 employees, he said. The bank has already closed some 70 branches and 200-300 ATMs since the merger.

MUFG's core banking unit currently has about 600 branches, and MUFG had a groupwide workforce of about 78,300 at the end of the last business year.

The job reductions will take place at the bank's head office, which has about 6,000 workers, Miya said.

"The bank just finished its system integration in December, so it is understandable that it still has some more overhaul to do (after the merger)," Credit Suisse analyst Shinichi Ina said.

"Since the economic environment is different now from when it merged, I'm sure it is making an adjustment (in its restructuring progress) accordingly ... but this does not seem like anything out of the ordinary."

Shares of MUFG gained 2.9 percent to 503 yen as of 0057 GMT, against a 2.4 percent rise in Tokyo's subindex of bank stocks .IBNKS.T

(Reporting by Sachi Izumi; Editing by Chris Gallagher)