Growth in bank lending accelerated for the first time in eight months in August as property-related financing expanded, the Bank of Japan said Monday.
Loans excluding trusts rose 0.5 percent from a year earlier, quickening from a 0.3 percent gain in July. Lending adjusted for currency fluctuations, bad-loan writeoffs and securitizations increased 1.3 percent compared with a revised 1.2 percent in July.
Real estate lending is one of the few areas of expansion for banks as companies curtail investment amid increasing signs of a slowdown in the U.S., Japan's biggest export market. Growth in borrowing has cooled from its recent peak in July 2006. Businesses may have also turned to banks for funds as ructions in financial markets worldwide curbed bond issuance. Deepening losses in the U.S. subprime mortgage industry caused corporate credit costs to jump, global stocks to plummet and the yen to surge.
"Some companies chose to borrow money from banks rather than issuing corporate bonds as U.S. subprime loan turmoil increased volatility in markets," said Michio Kitahara, associate director general of the BOJ's surveillance department. "The trend of steady growth in lending hasn't changed."