Japanese banks are turning to asset-based fees to generate a reliable revenue source under Bank of Japan's policy that has kept ultra-low rates for years.

Sumitomo Mitsui, Japan's second-largest lender by asset, has decided to buy a foreign asset manager for the first time, the bank said in a statement, adding the transaction is slated to close this financial year.

SMFG will spend about 20 billion yen (153.53 million pounds), according to a person knowledgeable about the plans.

However, the company did not disclose any transaction details in the statement.

With $8.4 billion in assets under management, London-based TT international, an expert on emerging-market equities, will be operated separately from SMFG's Sumitomo Mitsui DS Asset Management, the Japanese bank said.

Other Japanese lenders have also made attempts to expand aggressively into overseas asset management. Mitsubishi UFJ Trust and Banking bought Commonwealth Bank of Australia asset management unit for $2.9 billion last year.

The government has tried to turn yield-hungry Japanese savers into investors as its households' financial assets reached 1,835 trillion yen at the end of June, according to Bank of Japan's statistics.

(Reporting by Takashi Umekawa; Editing by Stephen Coates and Sherry Jacob-Phillips)