Japan's Regional Banks Face $47 Million In Subprime Losses


Japan's 109 regional banks collectively face about 5.4 billion yen ($47 million) in losses from financial products tied to U.S. subprime loans, according to a survey by the Nikkei business daily.

The survey underscores the relatively limited direct exposure of Japanese banks to the turmoil in the U.S. subprime mortgage market. Combined losses disclosed by Japan's eight big banks have so far been limited to 20 billion yen, the Nikkei said.

Of Japan's 109 regional banks and banking groups, 23 have exposure to products tied to so-called subprime mortgages extended to those with poor credit, according to the survey conducted by the newspaper late last month.

Collective exposure comes to about 52 billion yen but because most of the products carry triple A ratings, the losses are expected to be limited to about 5.4 billion yen, the newspaper said.

San-in Godo Bank, which is based in Shimane Prefecture, and Ibaraki Prefecture-based Joyo Bank were the only respondents with exposure of more than 10 billion yen, the newspaper said.