SoftBank checks with Japan’s top lenders for $2.8 billion loan

Softbank Group Corp is checking with Japan’s top three banks to loan 300 billion yen ($2.8 billion) to be used as fund for support of US startup WeWork, according to three sources who refused to give identity.

Although no official talks have begun, Softbank has approached Mizuho Financial Group Inc, Mitsubishi UFJ Financial Group Inc, and Sumitomo Mitsui Financial Group Inc.

A Softbank spokesperson said that the main option was a loan although nothing had been agreed to yet. All three banks refused to comment.

In October, Softbank has offered $9.5 billion lifeline to take control of WeWork.

With Japan’s ultra-low interest rates, Softbank has given the three Japanese banks a rare profit opportunity at home. However, these top three banks have been cautious of getting involved with the conglomerate, since the turmoil involving WeWork.

“We have to be very careful about this,” said one of the sources. “Especially if the money goes to WeWork, it will take a long time to conclude the process.”

Softbank fell to its first quarterly loss in 14 years, dragged by the $8.9 billion hit at Vision Fund. CEO Masayoshi Son admitted the fall was due to poor investment judgment and being blind to problems at startup WeWork.