Mitsubishi UFJ Financial Group Inc. said Sept. 22 it has reached an agreement to acquire between 10 percent and 20 percent of common shares in the second-largest U.S. brokerage, Morgan Stanley.

Based on Morgan Stanley's share prices in late August, company sources said the largest Japanese banking group is likely to invest up to around ¥900 billion. It may also become the Wall Street firm's largest shareholder, if it buys 20 percent of the shares.

Morgan Stanley hopes to boost its capital as it struggles to remain afloat amid speculation of additional subprime-linked losses.

As part of the agreement, MUFG also plans to dispatch at least one member to Morgan Stanley's board, marking a fresh bold move by relatively healthy Japanese financial institutions to enter the embattled U.S. financial sector.