UPDATE 2-Japan's Seven Bank raises $481 mln in IPO

(For Japanese IPO diary and data, click on <JP/IPOMENU>) (Recasts, adds comment and details)

By David Dolan

TOKYO, Feb 21 (Reuters) - Shareholders in Seven Bank Ltd, which operates ATMs in convenience stores owned by Seven & I Holdings Co Ltd (3382.T: Quote, Profile, Research), raised $481 million after its IPO was priced at the top of its projected range, as investors rattled by the subprime crisis embraced its low-risk business model.

The initial public offering is Japan's biggest since Sony Financial Holdings Inc's (8729.T: Quote, Profile, Research) $3 billion offering in October, and comes as demand for new issues has been hurt by the global credit crisis. The value of IPOs in Japan dropped by about 70 percent to $5.8 billion in 2007, according to Thomson Financial.

The small bank likely appealed to cautious investors because it draws revenues from bank charges at automated teller machines in 13,000 7-Eleven stores, and even at the top of the IPO range, the shares were priced more cheaply than its Japanese banking peers.

Its avoidance of lending risks puts Seven Bank in a different league to other financial institutions caught in the subprime crisis, said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.

"You can call it a financial firm, but the company is just ATMs so it doesn't have any non-performing loans. It's a simple business model based on taking fees," Ogawa said.

"The fact that they priced at the top of the range probably means there was demand from institutional investors ... It's a stable, low-risk business."

Seven Bank priced the IPO at 140,000 yen per share, at the top of its pre-set range of 120,000-140,000 yen, ahead of its listing on the Jasdaq Securities Exchange, Japan's largest market for start-ups, on Friday next week.