Major Japanese financial groups and securities houses have emerged as saviors for troubled U.S. financial firms through capital infusion or partial acquisition.

The financial crisis in the United States is regarded as a god-given opportunity for Japanese financial institutions to improve their standing in the international financial marketplace.

Last Monday, an executive of Mitsubishi UFJ Financial Group Inc. was delighted that Morgan Stanley, the second-largest U.S. securities firm, had approached the group to seek financial assistance.

"Morgan Stanley has been a financial company beyond our reach. Its request for help is like a dream come true," he said after his group decided to provide funds totaling about 900 billion yen to Morgan Stanley.

It is the largest capital infusion by a Japanese bank for a foreign financial institution. MUFG appears to be emboldened now that it will become the largest shareholder of Morgan Stanley.

Since Lehman Brothers Holdings Inc., the fourth-largest U.S. investment bank, went belly up on Sept. 15, Japanese banks and securities houses have been actively looking for opportunities, such as acquiring distressed U.S. financial firms or providing capital to them.

Last Monday and Tuesday, Nomura Holdings Inc., Japan's largest securities house, decided to purchase the Asian and Middle East operations of Lehman Brothers.

On Wednesday, it was revealed that Sumitomo Mitsui Banking Corp. was considering investing in Goldman Sachs Group Inc., the largest U.S. securities firm.

The sudden rise of Japanese financial institutions' standing has stemmed from the plight of the U.S. financial sector, which is suffering a meltdown from the subprime loan debacle. U.S. financial institutions have sought assistance from their Japanese peers, whose damage from the subprime crisis has been less serious.

Following the outbreak of the subprime crisis in August last year, sovereign wealth funds, including those of Middle East countries awash with oil money and Singapore, initially extended a helping hand to troubled U.S. financial institutions.

However, sovereign wealth funds have become increasingly dissatisfied with the failure of U.S. financial firms to improve their businesses as the subprime crisis has evolved into a hopeless mess, according to a senior Bank of Japan official. Consequently, U.S. financial institutions have turned to Japan for assistance.

In this case, Japanese financial institutions are thinking of expanding their international operations by joining hands with major foreign firms to make up for the shrinking business in the country.

However, capital infusion in U.S. financial institutions, which are the epicenter of the subprime crisis, may be a double-edged sword for Japanese financial firms, because they will have to take great losses if the business of the foreign firms they have invested in deteriorates.

MUFG, which harbors the biggest ambitions for U.S.-bound investment in connection with the U.S. financial market crisis, is seeking a stake of up 20 percent in Morgan Stanley so that it will be able to treat the U.S. firm as an affiliated company in its consolidated financial statements.

However, on Wednesday, U.S. credit rating agency Standard & Poor's began considering lowering the rating of MUFG on the grounds that its investment in Morgan Stanley would weaken its capital base.

In a related development, Mizuho Financial Group Inc. declined to accept an invitation from Morgan Stanley for a capital infusion. "With no end in sight to the subprime debacle, honestly speaking, it is hard to gauge the risk," a Mizuho executive said.

The Mizuho group was cautious about providing a huge amount of funds to Morgan Stanley as it registered 670 billion yen in subprime-related losses, taking the biggest hit among Japanese financial firms.

Meanwhile, SMBC is ready to inject funds into Goldman Sachs when it receives an official request to do so.

An SMBC executive pointed out that his group has had a close relationship with Goldman Sachs since the 1980s, when the former Sumitomo Bank was the largest shareholder of Goldman Sachs. It cannot turn a blind eye to the U.S. firm's difficult situation, he said.

When SMBC was in dire straits due to nonperforming loans in 2003, Goldman Sachs did the Japanese group a favor by buying its preferred stocks.

The difference among Japanese financial institutions concerning their stances toward efforts to help bail out U.S. financial institutions reflects the facts that their assessments of the subprime crisis differ and that some of them are not necessarily confident of their own strengths.

On Tuesday evening in the United States, Goldman Sachs' stock price surged in off-hours trading to 134.75 dollars, up 8 percent from the previous day, on the news that it would receive a 7.5 billion dollars capital boost.

On Wednesday, the stock price of SMBC increased by 24,000 yen to 700,000 yen from Monday as investors expect it to accelerate the expansion of its overseas operations.

The stock markets appeared to have reacted favorably to the Japan-U.S. financial tie-up, but the alliance will now be put to the test.