Japan bank lending, deposits keep rising in Dec as pandemic strains persist
[TOKYO] Japanese bank lending continued to rise in December to hit a fresh record, data showed on Tuesday, as companies kept piling up cash to weather the fallout from the coronavirus pandemic.
Outstanding loans held by the country's four main categories of banks, including "shinkin" or credit unions, rose 6.2 per cent in December from a year earlier to a record 577.6 trillion yen (S$7.31 trillion), Bank of Japan data showed.
Total deposits at the banks also surged 9.3 per cent to a record 802.9 trillion yen, as some companies parked the money they borrowed in their accounts for the time being, the data showed.
"Some companies were holding back on capital expenditure and cutting fixed costs," which was also behind the increase in deposits, a BOJ official told a briefing.
Aside from lending, commercial banks were using the money from the huge deposits to increase purchases of short-term securities and government bonds, the official said.
The BOJ eased monetary policy twice last year to cushion the economic blow from Covid-19, including by creating a new lending facility aimed at channeling funds to cash-strapped firms via financial institutions.
GET BT IN YOUR INBOX DAILY
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
While lending by cash-strapped firms has peaked, the government's decision to impose new state of emergency curbs to prevent the spread of the virus has clouded the outlook for the world's third-largest economy.
REUTERS
KEYWORDS IN THIS ARTICLE
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Banking & Finance
Nomura, Mizuho face losses on All Blue fund’s failed trades
Stablecoin Tether steps up monitoring in bid to combat illicit finance
HSBC asked by US$890 billion investor group to set energy goal
Barclays is the latest firm to face anti-ESG wrath in Oklahoma
Barclays prices mortgage-backed notes in deal with GoldenTree
TD risks an earnings hit from US laundering probe, analysts say