Cross-border Activity of Japanese Banks
IMF Working Papers, November 22, 2013
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Bibliographic details
- Authors: Waikei R Lam
- Published: November 22, 2013
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781475520484.001
Summary and main findings
- This paper explores the determinants of Japanese banks’ overseas expansion and assesses whether the growing cross-border activity will continue under the new macroeconomic policies referred as “Abenomics”.
- The analysis finds that Japanese banks are well positioned to scale up foreign exposures, thanks to their relative resilient balance sheets and continued growth in the region.
- Stronger domestic growth in Japan could mitigate the pace, but is unlikely to reverse the expansion as global and regional pull-factors play a more prominent role in the growth of cross-border claims.
- Increasing cross-border activity could pose funding risks and supervisory challenges and require continued close monitoring.
Determinants and projection under “Abenomics”
- Determinants emphasized:
- Relative resilient balance sheets of Japanese banks.
- Continued growth in the region (Asia and Pacific).
- Global and regional pull-factors dominating the growth of cross-border claims.
- Projection:
- Japanese banks are well positioned to scale up foreign exposures.
- Stronger domestic growth in Japan could mitigate the pace of overseas expansion but is unlikely to reverse it.
Risks, supervisory implications, and monitoring
- Potential risks and challenges identified:
- Funding risks associated with increasing cross-border activity.
- Supervisory challenges stemming from expanded overseas exposures.
- Policy implication:
- Continued close monitoring of cross-border activity is required.
Publication and metadata
- Author: Waikei Raphael Lam
- Publication date: November 22, 2013
- Series: Working Paper No. 2013/235
- Issue: 235
- Volume: 2013
- Pages: 18
- DOI: https://doi.org/10.5089/9781475520484.001
- Stock No: WPIEA2013235
- ISBN: 9781475520484
- ISSN: 1018-5941
- Subject: Banking; Financial crises; Financial institutions; Foreign currency exposure; Global financial crisis of 2008-2009; Loans; Money; Project loans; Syndicated loans
- Keywords: Abenomics, Asia and Pacific, bank, bank lending, banks' activity, core profitability, cross-border banking, Europe, exchange rate, Foreign currency exposure, funding risks, Global, Global financial crisis of 2008-2009, Japan, Japanese bank, loan, Loans, overseas activity, overseas expansion, Project loans, Syndicated loans, trust bank, WP
IMF Working Papers. Cross-border Activity of Japanese Banks. By Waikei Raphael Lam. November 22, 2013.