U.S. Bancorp plans to issue $936 million in shares to Mitsubishi UFJ Financial Group Inc. following its acquisition of the Japanese lender’s US regional banking business last year.

U.S. Bancorp will use the proceeds from the sale of the 24 million shares to satisfy a portion of a previously announced repayment obligation to MUFG, the Minneapolis-based firm said in a statement.

The US lender completed the acquisition of MUFG Union Bank’s core regional banking franchise in December 2022. At the time, it received $3.5 billion in additional cash held by MUFG Union Bank, of which as much as $1 billion was to be repaid within a reasonable time.

Read more on U.S. Bancorp’s purchase of MUFG Union Bank

The proceeds of the stock issuance will satisfy the payment requirement, with the remainder due in cash by the previously agreed deadline of Dec. 1, 2027, U.S. Bancorp said.

The transaction will also strengthen the bank’s strategic relationship with MUFG, it added.