The Financial Services Agency will strictly assess banks' ongoing plans to reconstruct struggling large-lot borrowers and may order remedial measures if little improvement is found in the borrowers' earnings conditions, informed sources said Saturday.
The FSA will introduce the new assessment system as part of its special inspection of banks, the sources said.
If the corporate borrowers' earnings and other financial conditions show no sign of improvement under the reconstruction plans, the FSA will order creditor banks to devise effective measures to dispose of their bad loans, including putting up more loan-loss reserves, the sources said.