Negative Rates Scorned by Japan’s Megabanks as Charts Turn Ugly
- Loan growth slows, margins narrow, bad debts rise, costs swell
- Bank stocks are worst Topix performers as profit seen dropping
Japan's Banks Scorn Negative Rates
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Negative interest rates are adding to an ugly set of metrics for Japan’s three largest lenders, with loan growth slowing, credit margins narrowing, bad debts rising and costs creeping higher.
In the three months since the Bank of Japan sent shockwaves through the financial system by charging fees on some reserves, shares of the so-called megabanks have plunged as they forecast their lowest combined profit in five years. Mitsubishi UFJ Financial Group Inc. President Nobuyuki Hirano said in a speech in Tokyo last month that rates below zero have worsened anxiety among its customers and may weaken financial institutions.