December 21, 2013 11:37 pm JST

Japan banks' overseas assets top 100 trillion yen 1st time in 15 years

TOKYO -- The total value of assets held by the overseas branches of Japanese banks has exceeded 100 trillion yen ($948 billion) for the first time in 15 years, The Nikkei learned Saturday.

     In October, the figure stood at 101 trillion yen, up 37% from a year earlier and topping 100 trillion yen for the first time since September 1998. Most of the assets are held in the form of loans.

     Major banks saw their overseas assets jump 36% on the year in October to about 91 trillion yen, while regional banks logged a 52% increase to 960 billion yen. Fueling the growth at regional banks are moves by their corporate customers to accelerate their expansion into foreign markets.

     According to the Bank of Japan, Japanese banks' overseas assets peaked at 195 trillion yen in 1990. The figure then continued to decline, falling to 38 trillion yen in March 2004, as they were forced to cut foreign operations due to the bad-loan issue in the wake of the collapse of the bubble economy.

     Meanwhile, the combined amount of deposits at Japanese banks' overseas branch offices remains stuck at much lower levels than that of loans, unable to keep pace with sharply rising demand for lending.

     To cope with the situation, many Japanese banks have been trying to diversify their funding methods, with the three megabanks issuing long-term, foreign currency-denominated corporate bonds.