Through a three-way merger, Japan would give the world its largest bank, but it could take years for that new bank to exert the influence and power its compatriots once wielded in U.S. markets.

Dai-Ichi Kangyo Bank, Industrial Bank of Japan, and Fuji Bank confirmed Friday that they would merge to form a $1.3 trillion-asset behemoth, eclipsing the current world banking giant, Deutsche Bank AG. In doing so, the new bank would streamline its workforce by 15% and reorganize its massive debts and problem loans.

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