Japanese banks post losses

13 May 2011

A number of Japanese banks have posted considerable losses and are expecting a sluggish year ahead.

Reuters reports that Mizuho Financial Group has recorded a drop of 8.8 billion yen for the first quarter of 2011, while Sumitomo Mitsui Financial Group endured a 39 billion yen tumble.

The institutions noted they anticipate lending to stay subdued for the remainder of the year.

According to the news agency, the March 11th earthquake and subsequent tsunami had a limited direct impact on the banks, but the stock market dip that followed has been felt particularly hard.

Chikako Horiuchi, an analyst at Fitch Ratings in Tokyo, said: "The stock market slumped and interest rates became unstable so the banks were hit by the market. They also suffered poor performance at their units."

Following the economic tension caused by the recent earthquake and tsunami in Japan, the Bank of Japan recently pumped record funds into the country's financial system to ease the pressure.

By Tony Aynsley

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