Corporate loan demand finally rises

JIJI

Companies’ demand for bank loans in April rose for the first time in 12 months, a Bank of Japan survey showed Friday.

The diffusion index gauging corporate loan demand at major banks rose to 6 from minus 2 in the previous survey in January.

Major companies are shifting to loans from bond placements to raise funds thanks to lower lending rates reflecting the BOJ’s additional monetary easing, officials said.

Small firms are seeking loans in their reconstruction efforts after the March 2011 earthquake and tsunami.

The index rose to 9 from minus 2 for major companies and 4 from minus 3 for small firms.

The figure fell to minus 4 from minus one for other companies.

The DI is the percentage of banks seeing stronger demand minus that of banks seeing weaker demand.