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To: Thomas G. Busillo who wrote (73697)	10/21/1998 10:49:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 176387

Nikkei is up on news from the banking front. Tom: The Japanese market thinks it is good new from the banking sector,the Nikkei is up nicely.Besides the willingness of the banks now to take on the bad debt problems they are now willing to receive fund infusion from the government as there was talk earlier the major banks might be reluctant to do so,obviously good news if one were to go by the reports from Japan and the Nikkei. ================ Wednesday October 21, 10:21 pm Eastern Time (Note: this article is ''in progress''; there will likely be an update soon.) Nikkei ends morning up 2.92 pct, eye on NTT DoCoMo TOKYO, Oct 22 (Reuters) - Tokyo's key stock average finished the morning session 2.92 percent higher on Thursday, as shares in the banking sector got another boost amid hopes that a number of banks are showing greater willingnes to seek injections of public funds in order to try to recapitalise themselves, traders said. (Note: this article is ''in progress''; there will likely be an update soon.) ============================ Courtesy: Bloomberg Banks Show Greater Willingness To Take Public Funds After Stocks Surge TOKYO (Nikkei)-Momentum is building for Japan's major banks to file for injections of public funds under a bank recapitalization scheme approved by the Diet last week. Following the lead of Industrial Bank of Japan (8302), at least three other big banks - Fuji Bank (8317), Tokai Bank (8321) and Daiwa Bank (8319) - indicated Wednesday that they are mulling plans to apply for a funds infusion. A senior executive at Fuji Bank told The Nihon Keizai Shimbun it would likely seek funds, after studying details such as the dividend rates that will apply for issuance of preferred shares. "The basic direction is to file," the executive said. Tokai Bank's chairman, Satoru Nishigaki, said that the bank was "thinking in a positive manner" about a recapitalization. A senior Daiwa Bank executive said that his bank "would make a positive decision in view of the current state of the Japanese economy." Many of Japan's big banks, seeing their capital bases eroded by disposals of bad loans, are under enormous pressure to call in loans in order to meet international capital-adequacy standards adopted by the Bank for International Settlements. But the banks appear to be leaning toward the conclusion that stepped-up loan collection could deepen Japan's recession, ultimately causing their balance-sheets to deteriorate further. Until Wednesday, caution over the recapitalization program was the dominant reaction in the banking industry. Banking executives had expressed concerns about the impact of new equity issuance on their stock prices, the prospect of state interference in bank operations and government pursuit of blame among bank managers. But a stock market rally Wednesday, triggered by the news that IBJ intended to file for a funds injection, was a major cause for re-evaluation. The new perception is that the stock market would more likely reward a bank for shoring up its balance sheet than punish it for diluting the value of existing shares. (The Nihon Keizai Shimbun Thursday morning edition)