TOKYO, Sept 8, 2007 (AFP) - Japan's three major banking groups will invest in a bank set up by the country's top retailer Aeon Co., press reports said Saturday.

Mizuho Financial Group Inc., Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. will each hold a stake of a few percent in Aeon Bank, which is expected to begin operations in mid-October, the Kyodo news agency and the Yomiuri newspaper said.

Aeon is also soliciting investment from firms affiliated with the retail group and a number of other concerns, Kyodo said quoting financial industry sources.

East Japan Railway Co. and leading mobile phone carrier NTT DoCoMo as well as life insurance and non-life insurance firms are also considering investing in Aeon Bank, Yomiuri said.

The government's regulatory body Financial Services Agency is expected to provide Aeon with the banking licence in the middle of October, Kyodo said.

Aeon launched a unit in May last year to prepare for the establishment of the bank which will offer loans for individuals and serve as an agent for insurance and brokerage firms.

Aeon will be the first Japanese retail group to provide comprehensive financial services.

Aeon's rival Seven and I Holdings Co. owns Seven Bank, which focuses on automated teller machine (ATM) operations for shoppers.

Aeon Bank aims to set up more than 2,000 ATMs in shopping centers run by the group and convenience stores in the first five years of operation.