The outstanding balance of financial assets held by households marked its sharpest fall on record — by 5.2 percent — in the July-September period from a year earlier to ¥1.467 quadrillion due mainly to declining stock prices, the Bank of Japan said Tuesday.
It was the fourth quarterly fall in a row and the steepest since the central bank started the survey in 1979. The total amount of assets was the smallest since September 2005, when it stood at ¥1.461 quadrillion, the BOJ said in a preliminary report on its quarterly survey of the flow of funds accounts.
The result showed shareholders have suffered from the global financial turmoil, and that Japanese, widely seen as among the most risk-averse people in the world, have been withdrawing money from capital markets and shifting funds to relatively secure bank deposits.
A BOJ official suggested there could be worse to come as share prices and the value of other financial assets continue to fall in the wake of the credit crisis following the bankruptcy in September of U.S. investment bank Lehman Brothers Holdings Inc.
The balance of shares and other equities plunged 36.1 percent in the July-September quarter, the steepest fall on record, to ¥118.42 trillion.
Securities other than stocks fell 12.8 percent to ¥102 trillion and the balance of insurance and pension reserves declined 0.8 percent to ¥402 trillion.
Individual assets held in cash and deposits rose 1.1 percent to ¥778.74 trillion as more people chose to keep money in hand or in banks, rather than investing in financial markets. The balance of time deposits, which bear relatively high interest rates, increased 1.5 percent, rising at the fastest pace in nine years, the BOJ said.