The combined balance of bad loans at Japan's 129 banks dropped by a net 3.7 trillion yen to 31.6 trillion yen during the April-September period, the Financial Services Agency said Friday.
The FSA attributed the fall partly to banks' sales of collateral seized from defaulting borrowers, as well as to an improvement in the quality of some loans that had been previously categorized as bad loans.
The 129 banks consist of 13 major banks, 64 regional banks and 51 second-tier regional banks, plus Saitama Resona Bank, a core unit of the partially nationalized Resona Holdings Inc.