TOKYO (AFX-ASIA) - Minister of Financial Affairs Hakuo Yanagisawa said banks' new bad loans are showing a declining trend, adding that loans subject to the government's write-off plan have fallen to 11.6 trln yen from 12.7 trln.
"Banks have already covered newly created bad loans with loan-loss reserves in the year to March 2001 so there is no possibility that banks' financial conditions will worsen further," he told a parliamentary Lower House committee.
"As a whole, large banks' new bad loans are showing a declining trend," Yanagisawa said. "The sum of bad loans subject to the government's write-off scheme has dropped to 11.6 trln yen at present, from the previous 12.7 trln."
He added: "I believe we are in a position to write off the 11.6 trln yen in bad loans within two years because the bulk of the figure has been covered by loan-loss reserves."