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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (64429)	7/12/1999 12:33:00 PM
From: scaram(o)uche	Respond to of 132070

Guffaw (eom)

To: Knighty Tin who wrote (64429)	7/12/1999 1:29:00 PM
From: John Pitera	Read Replies (2) \| Respond to of 132070

Michael, Japan Banks seem to be unable to find enough borrowers. SO it looks like the Japanese revival is not firing on all cyclinders quite yet. July 12, 1999 -------------------------------------------------------------------------------- Lending by Japanese Banks Falls At Record Pace on Weak Demand By MICHIYO SEKI Dow Jones Newswires TOKYO -- Bank-lending in Japan dropped at the fastest pace ever in June, underscoring companies' flagging demand for funds, analysts said. The Bank of Japan said Friday that lending by Japanese banks fell 5.7% in June, accelerating from a 5.4% drop in May. Unlike last year, when banks held back from making new loans amid instability in the financial sector, June's fall was the result of companies refraining from spending money for capital improvements, to restructure their operations, analysts said. "Companies are not only holding back on asking for new loans, but are paying debt back in order to shrink their balance sheets," said Naomi Hasegawa, senior economist at Tokyo-Mitsubishi Securities. The June bank-lending numbers were one in a series of data showing that while banks are willing to lend, companies don't want the money. The latest quarterly tankan survey on business sentiment showed, for example, that more companies feel that banks' stances on lending are accommodative rather than severe, compared with three months ago. But the survey also revealed that companies plan to pare back capital-investment outlays by 11.1% during the current fiscal year beginning April 1. Although that was a slight improvement from companies' expectations three months earlier that capital spending would decrease by 13%, it still highlighted the low level of interest in capital spending. "Simply speaking, the bad economy is to blame," said Ryutaro Kono, senior economist at Dai-Ichi Life Research Institute. "This has nothing to do with a credit crunch." Analysts said that the efforts by the Bank of Japan and government to ease liquidity concerns has been bearing fruit. The Bank of Japan's policy to drive short-term interest rates down to near zero, and the government's injection of 7.45 trillion yen ($60.78 billion) in public funds into major banks, have made banks much more enthusiastic about lending out their extra cash.