Michael Bradfield, Esq.
Jones, Day, Reavis & Pogue
Metropolitan Square
1450 G Street, N.W.
Washington, D.C. 20005-2088

Dear Mr. Bradfield:

Yesterday, you provided clarifying information regarding the lending and leasing activities of The Sakura Bank, Limited, Tokyo, Japan, that were the subject of my letter to you of February 21, 1997. You indicated that, since receiving Board approval to conduct lending and leasing activities, Sakura either engaged in lending and leasing activities in the United States or was prepared to conduct these activities. You inquired whether this fact would change the staff's views regarding whether Sakura may transfer its lending and leasing activities to a new nonbanking subsidiary without obtaining additional prior System approval.

Based on a review of the facts, staff continues to believe that Sakura may conduct lending and leasing activities without further System approval. This opinion is based on the facts you have provided and relates only to the activities that have been identified. Any changes in these facts or circumstances may result in a different opinion.

Sincerely,

(signed) Scott G. Alvarez

Scott G. Alvarez