OSAKA — For the second time this week, Bank of Japan Gov. Masaru Hayami on Thursday urged Japanese banks to quickly apply for public funds to accelerate their bad-loan writeoffs.In his keynote speech at the 24th ASEAN-Japan Business Meeting here, he said that Japanese financial institutions, facing serious bad-loan problems, need to promptly strengthen their thinning capital bases in order to restore confidence in domestic and foreign markets.Through the infusion of funds and full disclosure of bank information, financial institutions can dispose of their nonperforming loans, Hayami told the 80 business leaders and researchers from Japan and member states of the Association of Southeast Asian Nations gathered for the event.Under new legislation for bank recapitalization that took effect last Friday, Japan has set aside 25 trillion yen in public funds to reinforce the capital bases of viable banks and prevent the credit crunch from worsening. “We strongly hope all banks continue to concentrate on restructuring,” he said. “Observing a trend of reorganization of the financial industry and deciding what course to take in the future, they should create solid business strategies.”Pointing to government efforts to revive the economy through recent legislative moves, tax cuts and a third supplementary budget, Hayami predicted that the speed of the economy’s deterioration will be slowed.Hayami said the BOJ will provide necessary capital liquidity for macroeconomic and microeconomic purposes to wipe out concerns over Japan’s financial system. He said the central bank will supply ample funds to the market to meet yearend capital demand.Jiro Ushio, chairman of the association, said in his opening speech that Japan and ASEAN nations must endeavor to promote cooperation in currency and financial markets to heal ailing Asian economies.He also remarked on what he called “the shortcomings of global capitalism,” saying that it is necessary to “regulate the flow of extremely speculative short-term capital.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.