Hi this comes from today
BOJ to banks: disclose and disposehttp://www.japantimes.co.jp/news/news6-98/news.html#story1
Bank of Japan Gov. Masaru Hayami sent a strong
message to domestic financial institutions Tuesday, calling
on them to make greater efforts to disclose information
regarding their bad loans and effectively take steps to
dispose them.
The move was also seen as an indirect effort to improve
confidence in the economy in markets both at home and
abroad.
A lack of confidence is sometimes cited as a factor
behind the yen's recent nosedive. "While it is totally up to
the financial institutions to decide the extent to which they
disclose the contents of their internal assessments (of
their nonperforming loans), the Bank of Japan hopes that
disclosure progresses and leads to the recovery of
market trust in our financial system," the BOJ head said
in a statement.
Hayami said it was "a shameful situation" that Japanese
financial institutions were still struggling with huge
amounts of sour loans despite the fact that seven years
have passed since the bubble economy imploded.
"If these nonperforming loans remain on their balance
sheets, the eyes viewing the Japanese economy both at
home and abroad will not brighten, and this is one of the
major factors behind the recent sluggishness of the
economy," he told a regular news conference.
The BOJ has already informed the head of the Japan
Federation of Bankers Associations of its position on the
matter, but the issue of disclosure would be a decision
banks should make voluntarily, he said.
Last week Satoru Kishi, federation chairman and
president of the Bank of Tokyo-Mitsubishi, indicated
that banks were cautious about the matter, citing the fact
that financial institutions in the United States did not
disclose their categorization figures.
At present, financial institutions place their loans into four
categories depending on the degree they believe them to
be collectable based on individual standards.
In addition, Hayami denied allegations Tuesday that the
yen's continued fall against the dollar was the major
reason behind the weakening of other Asian currencies.
The excessive dependence of these economies on the
dollar is the main factor behind their currency problems,
he said.
Hayami did not comment on market rumors that
authorities had intervened in currency markets earlier in
the day to shore up the yen. "(The level of foreign
exchange rates) in general needs to be left up to market
forces, but often we see excessive movement in the
market. At such times exchange levels are later
corrected," he said. |
