TOKYO -- Total earnings at Japanese banks would likely improve if domestic interest rates climbed by 1 percentage point, with favorable yield spreads outweighing temporary losses on bond holdings, a report released Friday by the Bank of Japan shows.
The central bank's estimate of interest rate risk in its latest Financial System Report works out to roughly 3 trillion yen ($20 billion) to the upside. It noted that a base of sticky core deposits offsets downside risks.
