Bailing out Western banks is becoming something of a hot investment in Asia. British newspaper The Times reports Japan’s three biggest banks are set to invest as much as $10 billion in U.S. and European banks hit by the deepening subprime housing turmoil. Mitsubishi UJF, Mitsui Sumitomo Financial Group and Mizuho Financial, told the newspaper they had readied a combined $10 billion and were open to talks with any bank that approached them for a cash infusion. Mizuho had already said it would invest $1.2 billion in Merrill Lynch as part of a $6.6 billion cash injection. One MUJF insider told the paper that his firm would compete directly with Asian sovereign wealth funds as a long-term investor in troubled U.S. banks.

U.S. financial firms have approached China’s biggest insurer. “There have been many who have approached us in recent days, but we’ll select the most suitable,” said Wan Feng, president of China Life Insurance. China Investment Corp, the country’s sovereign wealth fund, China Development Bank, the State Administration of Foreign Exchange and CITIC Securities Co have all invested in U.S., British and Australian financial institutions in recent months. Things are getting a bit tighter for liquidity-soaked Chinese banks, so looking further afield makes sense. China raised banks’ reserve requirements for the eleventh time since the start of 2007 on Wednesday. The reserve requirement for big banks is now at a record 15 percent.

British hedge fund TCI says it wants to boost its stake in Japanese utility J-Power to up to 20 percent, challenging Japanese attempts to control foreign investment in defense-related sectors. The government could take up to five months to examine TCI’s request. If it rejects the move, it would be the first case of the government using takeover rules to block a foreign entity raising its stake in a Japanese firm on national security grounds.

Miner Rio Tinto, which has rejected a bid approach from BHP Billiton, said it had not had further contact with its larger rival and it was confident about prospects as an independent company. BHP, the world’s biggest miner, has said it is prepared to offer three of its own shares for each Rio share, valuing Rio at about $108 billion at current prices. Britain’s takeover regulator has set BHP a deadline of Feb. 6 to either make a firm offer for Rio or walk away.

SGS, the world’s largest inspection services firm, said it saw better prospects for acquisitions in 2008. The Swiss company said in a statement, “Market conditions in 2007 prevented SGS from carrying out significant acquisitions due to the exorbitant prices being asked. Better conditions are expected in 2008.” SGS’ abstention from major takeovers in the inspection, testing and certification sector last year raised doubts about its ability to keep growing amid increasing competition from rivals Intertek and Bureau Veritas.