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TOKYO, Oct 9 (Reuters): Japanese banks, which received massive government capital injections in a sector-wide rescue in the late 1990s, are likely have repayed around half the funds by the end of the current fiscal year, a newspaper reported today.
The government infused around 11 trillion yen ($97 billion) into major banks in 1998 and 1999, providing a capital cushion at a time when banks were struggling with problem loans, but saddling recipients with cumbersome oversight rules.
Banks have since returned to profit after clearing trillions of yen in bad debt.
According to the Nihon Keizai Shimbun newspaper, major banks are set to have repayed around half the funds they received by the end of the current fiscal year on March 31.
Several banks, such as Mitsubishi UFJ Financial Group and Mizuho Financial Group, may finish off all their repayments as early as next summer, it added.
Mitsubishi UFJ, the product of a merger between Mitsubishi Tokyo Financial Group and UFJ Holdings on Oct 1, and the world's biggest bank by assets, said Tuesday it would repay $3 billion it owed the government Wednesday morning.
Other banks have also been repaying money in increasingly large installments.
Mizuho returned 693 billion yen in August, while Resona Holdings, Japan's number 5 bank group, announced a 200 billion yen repayment late last month.
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