New, innovative entrants into the domestic banking sector have struggled to establish themselves amid the turbulent business climate.

Since October 2000, Japan Net Bank, IY Bank, Sony Bank and eBank Corp. have been launched in an effort to capitalize on the deregulation of the banking industry, considered one of the nation's most conservative and exclusive business sectors.

The ongoing economic slowdown, however, has hit their earnings severely, and fiscal first-half business reports show 11 billion yen in combined net losses.