Japan Fin Min Asks Banks To Request Public Funds - Nikkei

TOKYO (Nikkei)--Japanese Finance Minister Kaoru Yosano on Saturday asked leaders of industry groups that represent megabanks and regional banks to make requests for injections of public funds, the Nikkei reported in its Saturday evening edition.

This is the first time that Yosano has asked such major banks to accept the injections, which are available under new legislation designed to facilitate lending.

"We would like the core (of the banking industry) to strengthen its capital base," said Yosano while discussing the program and such measures as the Bank of Japan's purchasing of subordinated bonds issued by banks.

Yosano, who also serves as financial-services minister and minister for economic and fiscal policy, made the request to the heads of the Japanese Bankers Association, the Regional Banks Association of Japan and the National Association of Shinkin Banks during their meeting at the prime minister's office.

In response, Seiji Sugiyama, chairman of the Japanese Bankers Association and president of Mizuho Bank Ltd., expressed the industry's reluctance to request such injections by saying, "We would like to procure (funds) independently as much as possible."

The leaders of the other two organizations indicated similar views.

However, Sugiyama did not reject such injections outright, noting that banking operations "would be quite difficult if the Nikkei average were to fall below 5,000."