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Japan: Banks reluctant to heed government’s consolidation calls

 |  April 25, 2014

Regional banks across Japan are reportedly resisting the government’s encouragement to merge with each other in efforts to strengthen a stagnant market.

According to a Bloomberg survey, 19 of the 24 Japanese banks that responded said that they do not plan to strike a merger in the near future, while only five said they do. The results follow January’s call by Financial Services Agency Commissioner Ryutaro Hatanaka to consolidate or form alliances in efforts to reverse weak profit outlooks.

Experts have predicted a 40 percent downfall in the next five years for lender profits if they do not choose to consolidate. Reports say the slump is attributed to intense competition and a declining population.

Full content: Bloomberg

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