Bank lending in Japan fell 1.2%
Credit and Loan June 16th, 2010
Distribution of bank credit in Japan fell for the first time in 4 years in December after the company cut spending or issuing bonds.
Bank of Japan reported credit, not including joint credit, down 1.2% last month from a year earlier, after the November rose 0.1%. 10 credits from Japan called city banks, including Mitsubishi UFJ Financial Group Inc., fell 3.1% 1.3% continuing decline in the previous month.
Shiseido Co., Orix Corp., and Mitsubishi Heavy Industries Ltd including financial institutions that issue bonds in December. Meanwhile, the reluctance of small businesses to apply for credit to banks threaten efforts AM Yukio Hatoyama to boost growth.
“If you look at the size of the company, demand for loan funds are also weak. That’s what the banks. Financing of the larger banks, which clients can issue credit, the fall until the market returned to normal,” said Yoshihiro Komaki, director Financial Systems and Bank Examination Department, Bank of Japan, today.
Loan growth last year slowed every month until November after a greatest jump in 16 years by 4.1% in December 2008. Monthly decline in loan disbursement first time since December 2005.
Mitsubishi UFJ, Japan’s largest bank by market value, fell 0.2% to 477 yen at 10:41 am in Tokyo. Sumitomo Mitsui Financial Group Inc., ranked 2, down 1.3% and Mizuho Financial Group Inc. slipped 2.8%. Today, the Topix Banks Index dropped third largest in the stock market.
“The decline of credit was part of the credit market conditions are more normal. Globally, small firms worst affected due to the drying up of liquidity during the crisis,” said David Cohen, director of Action Economics in Singapore responded to the statement of the Bank of Japan.
Data showing the issuance of bonds in Japan rose 30% to 11.4 trillion yen (U.S. $ 123 billion) in 2009, from 8.8 trillion yen the previous year.
Cabinet Office in December reported Japan’s economic expansion to reach 1.3% annually during the third quarter.
Robert Feldman, head of economic research at Morgan Stanley Tokyo, said the GDP predicted to experience a moderate expansion during 2010 driven by foreign demand.
