Morgan Stanley is joining forces with Japan's Mitsubishi UFJ Financial Group in a US corporate lending venture that will give the Wall Street bank extra firepower to compete with rivals such as Citigroup and JPMorgan Chase.

Under a deal announced yesterday, and first reported on FT.com, Morgan Stanley and MUFG, which is the US group's largest investor through its holding of preferred shares, will pool their lending resources in an effort to gain a stronger position when dealing with American companies.