Japanese banks Sumitomo Trust and Chuo Mitsui Trust Holdings are in merger talks, two sources familiar with the matter tell Reuters, bringing together two struggling trust banks to better compete in Japan’s lucrative asset management industry.

Sumitomo Trust, Japan’s fifth-largest bank, this month completed a deal to acquire to acquire Citigroup’s Japanese asset manager Nikko Asset Management for $1.2 billion.

In other M&A news reported by Reuters and other media:

Bank of New York Mellon sees more acquisition opportunities in Europe than in Asia, the head of the world’s largest custodian of financial assets tells Reuters. European financial firms have been harder hit by the global economic crisis than their counterparts in Asia and are refocusing as a result.

Diversified U.S. manufacturer United Technologies Corp is the favourite in the bidding for General Electric’s security business, Bloomberg reports.

South Korea plans to sell a minority stake in third-ranked banking group Woori Finance Holdings in a block trade next month, Yonhap reports, in a deal that could bring in about $800 million and trigger more consolidation across the sector.

China’s Sinopec has offered to make a joint bid with Ghana’s national oil company for Kosmos Energy’s stake in the huge Jubilee oilfield off the coast of the country, the Wall Street Journal reports.