Stagnating Loan Demand May Push Banks to Bonds: Japan Credit
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Japanese Prime Minister Naoto Kan’s plan to plug a budget gap with record debt sales this year will get help from banks needing to park deposits that are outstripping loans by the widest margin on record.
Customer deposits at banks exceeded outstanding lending by 151 trillion yen ($1.8 trillion) at the end of November, up 37 percent from two years ago and equivalent to a third of the economy, according to Bank of Japan data. The Ministry of Finance plans to sell 144.9 trillion yen of government bonds in the year starting April 1, 600 billion yen more than the initial plan for fiscal 2010.