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Toshiba chairman says banks ready to offer conditional financial support

Toshiba Corp's chairman said its creditor banks are ready to provide financial support to the Japanese conglomerate, with conditions attached, following disclosures that it faces a multi-billion-dollar writedown of a U.S. nuclear business.

"At this moment, I have been told that (banks) will continue to provide support," Shigenori Shiga told reporters on Thursday on the sidelines of an industry gathering.

Shiga said banks' support would be conditional upon Toshiba giving them "solid explanations" about the potential writedown and how to improve its financial health.

Akio Kon | Bloomberg | Getty Images

The company is seeking creditors' support to weather yet another financial blow, even as it still tries to recover from a $1.3 billion accounting scandal in 2015.

Last week, it revealed it may have to book several billion dollars in charges related to a U.S. nuclear power plant construction company acquisition.

Toshiba has said it would finalise the losses by mid-February.

Toshiba Chief Executive Satoshi Tsunakawa visited banks, including its main creditors Sumitomo Mitsui Financial Group Inc (SMFG) and Mizuho Financial Group, last week, sources with direct knowledge of the matter said.

At the meetings, Toshiba's explanation did not go beyond what it disclosed at the news conference, the sources said.

Toshiba is expected to inform its main creditors the finalised writedown figures by the end of this month, said the sources, who were not authorised to discuss the matter publicly.

Some bankers expressed frustration as Toshiba was supposed to have gone through a complete checkup of its financial health after the 2015 accounting scandal that tarnished its image.

"Before we give them any financial help, it should come completely clean and have no surprises any more," said a senior executive at one of the banking groups.

Toshiba was not immediately available to comment. A Mizuho spokesman declined to comment. SMFG officials were not immediately available for comment.

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