Mizuho Financial Group Inc. is extending riskier types of corporate credit to fend off competition in a country that's awash with easy money.
Japan's third-largest bank by market value will offer companies more subordinated loans and other types of mezzanine finance, said Koji Fujiwara, CEO of the firm's main lending unit. "We will definitely increase it," he said in an interview.
Banks in Japan are looking for ways to boost profitability as negative interest rates squeeze net interest margins. Mizuho has been expanding a pool of what it calls "risk money" to earn higher returns than plain loans and deepen relationships with corporate customers.