Exposure of major Japanese banks to Lehman Brothers, which collapsed earlier this week, total about 310 billion yen ($3 billion), a major researcher reported Thursday.
The worst hit among the major banks is Sumitomo Mitsui Financial Group with 103.4 billion yen ($990 million) in exposure to Lehman, mostly in loans, according to Shinichi Ina at Credit Suisse in Tokyo.
Such exposure at regional Japanese banks is estimated at about 66 billion yen ($632 million), with 39 of the 87 listed regional banks having some kind of exposure to the Lehman group, he said, using information he had obtained from the banks.
Lehman filed the biggest bankruptcy in U.S. history on Monday, and is trying to unload its assets, including selling key North American units to Barclays bank.
The news sent global stock markets nose-diving and set off fears about a possible global recession and financial crisis. Shares of Japanese banks have declined in recent sessions.
Ina said banks’ earnings are likely to be hurt, but it’s reassuring that the level of exposure at Japanese banks are now disclosed.
The exposure of major Japanese banks are mostly in loans, while regional banks suffer exposure in bonds, he said.
Major banks have “considerable protection” from collateral and hedging so the damage in the end may be smaller although details are still uncertain, Ina said.
The worst hit among the major banks is Sumitomo Mitsui Financial Group with 103.4 billion yen ($990 million) in exposure to Lehman, mostly in loans, according to Shinichi Ina at Credit Suisse in Tokyo.
Such exposure at regional Japanese banks is estimated at about 66 billion yen ($632 million), with 39 of the 87 listed regional banks having some kind of exposure to the Lehman group, he said, using information he had obtained from the banks.
Lehman filed the biggest bankruptcy in U.S. history on Monday, and is trying to unload its assets, including selling key North American units to Barclays bank.
The news sent global stock markets nose-diving and set off fears about a possible global recession and financial crisis. Shares of Japanese banks have declined in recent sessions.
Ina said banks’ earnings are likely to be hurt, but it’s reassuring that the level of exposure at Japanese banks are now disclosed.
The exposure of major Japanese banks are mostly in loans, while regional banks suffer exposure in bonds, he said.
Major banks have “considerable protection” from collateral and hedging so the damage in the end may be smaller although details are still uncertain, Ina said.
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