XP updates start to p.o. users
wired.com
New IRS rules may diminish stock perks
news.com.com
Report: Japanese banks drastically trim overseas assets
nj.com
The Associated Press
4/29/02 7:57 AM
TOKYO (AP) -- Japanese banks have drastically reduced overseas assets since the early 1990s as the costs of raising money has risen due to their declining creditworthiness, a major Japanese newspaper reported Monday.
The banks held a combined 60.2 trillion yen ($466.66 billion) in assets at their overseas branches as of the end of February, down 63 percent from 1991, the Nihon Keizai financial newspaper said, quoting a survey by Japan's central bank. The report did not say how many banks were queried by the Bank of Japan.
Officials at the BOJ were not available for comment on the report Monday because of a national holiday.
In the mid-1980s, Japanese lenders took advantage of their high creditworthiness, and pocketed profits overseas by lending money at higher interest than they could get in Japan.
But the credit standings of Japanese banks have dropped due to the huge amount of bad debt they hold, causing their profitability to fall as their costs of raising funds has risen.
Bad debt ballooned as the value of collateral, such as land, has plummeted in the price collapse in the late 1980s.
The government has said that dubious loans at all the nation's banks total 36 trillion yen ($281 billion), but private analysts have warned the problem may be bigger.
Of the total overseas assets held by Japanese banks at the end of February, lending to companies totaled 27.7 trillion yen ($214.72 billion), down 60 percent from 1991 while cash deposits overseas stood at 10 trillion yen ($77.52 billion), down 80 percent from 1991, the newspaper report said.
The Nihon Keizai said overseas securities holdings totaled 5.4 trillion yen ($41.86 billion), down 30 percent from 1991. |
