Japan has three main banks. Those banks are championed by the government and the bureaucrats. The strongest one is MUFG. Second to this is Mizuho bank and as the third strongest bank SMBC comes in. Mizuho is probably comparable to Commerzbank in Germany, because the bank is largely involved in lending ot small and medium-sized companies. SMBC has a position in between and tries to position itself also in the securities market. The biggest and strongest bank also from an international perspective is MUFG. Nevertheless a clear strategy is missing. MUFG has the strongest depositor and retail base. It also has an international footprint, but it lacks a consistent strategy how to manage banks/subsidaries overseas.
Direct banking has not really taking off in Japan yet. ING direct gave up - just before the license would have been given. In case direct banking gets a bigger share in the market the margin pressure will be high on the three big banks.
Foreign banks mainly focus on wealth management like Credit Suisse and HSBC, but those banks could eat a nice piece of the profitable cake of the current banks. Shinsei bank and Aozora bank are not really a threat with their high debts and private equity ownership behind them. Even with the merger their capital base is quite weak.
Even the big three Japanese banks lack the skillset to manage foreign companies. Perhaps Nomura can prove the opposite with a successful integration of the former Lehman bank.
SMBC: Green (but to be watched carefully)
In the long run only two big banks and perhaps one security house (like Nomura) will play an important role in Japan and overseas.