Business / Corporate

Some Japanese lenders refuse to invest in companies linked to nuclear arms

Kyodo

Sixteen Japanese financial institutions say they refrain from investing in and extending loans to companies involved in the manufacturing of nuclear weapons and delivery systems.

A Kyodo News survey found that the lenders have set guidelines for such issues to avoid international criticism for conducting business with nuclear arms-related companies.

The 16 lenders include Japan's three mega-banks — MUFG Bank under Mitsubishi UFJ Financial Group Inc., Mizuho Bank under Mizuho Financial Group Inc., and Sumitomo Mitsui Banking Corp. under Sumitomo Mitsui Financial Group Inc. — as well as Japan Post Bank Co. and Resona Bank under Resona Holdings Inc.

Kyodo sent a written questionnaire to 119 city banks, regional banks and online banks from late February to early March. Of those, 35 responded. Of the others, most said they would not answer the survey because they have never discussed the issue.

A Resona Bank official said the Osaka-based lender drew up written rules in March 2018 that it will not invest in nuclear weapons, anti-personnel mines and other such fields due to rising international criticism against doing business with companies involved in the manufacture and development of weapons of mass destruction.

Eleven other lenders with similar guidelines are Saitama Resona Bank in Saitama Prefecture, Aozora Bank in Tokyo, SBI Sumishin Net Bank, Hokkaido Bank and North Pacific Bank in Hokkaido, Tohoku Bank in Iwate Prefecture, Ogaki Kyoritsu Bank in Gifu Prefecture, Kansai Mirai Bank in Osaka Prefecture, Minato Bank in Hyogo Prefecture, Higo Bank in Kumamoto Prefecture and Kagoshima Bank in Kagoshima Prefecture.

Nine respondents, including Hokkaido Bank, the Bank of Kochi in Kochi Prefecture and Oita Bank in Oita Prefecture, said they back the Treaty on the Prohibition of Nuclear Weapons.

Of 20 lenders expressing reservations about the 2017 U.N. nuclear ban treaty, five questioned the Japanese government's reluctance to sign it.

Japan does not possess nuclear weapons but remains under the nuclear umbrella of the United States.

Twelve respondents, including Tohoku Bank, Higo Bank and the Bank of Toyama in Toyama Prefecture, said they think the adoption of the U.N. pact would generate future risks in investing in nuclear-related companies.

None of the 35 respondents said they have provided funds to companies developing intercontinental ballistic missiles, bombers capable of carrying nuclear weapons and other nuclear weapons-linked infrastructure.

However, the three mega-banks declined to disclose their investments in nuclear-related companies.

While welcoming the 16 lenders for supporting such guidelines, the International Campaign to Abolish Nuclear Weapons, or ICAN, a nongovernmental organization and the 2017 Nobel Peace Prize laureate, said it suspects some still continue to invest in nuclear-related businesses.

"Companies that manufacture nuclear weapons conduct businesses in other areas," said Akira Kawasaki, a member of the International Steering Group of ICAN. "We see it as a perception gap between us and some banks that claim they abstain from investing in nuclear weapons manufacturing businesses."

ICAN wants those banks to disclose details about their guidelines, Kawasaki said.

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