Japan’s second largest lender posts jaw dropping loss
Mizuho Financial Group took an 80% drop in profit during 4Q11 on a tax asset write-down and weaker stock markets.
In numbers, that’s a free fall to US$213.4 million from US$1.1 billion from a year earlier, according to Reuters. The picture for April to December gets much worse for Mizuho: a total loss of US$1.5 billion from its share portfolio.
Lending by Japan's big banks fell 1% in December year-on-year, the 26th straight month of decline, said the Bank of Japan.
Mizuho and rivals Mitsubishi UFJ Financial Group, Inc. and Sumitomo Mitsui Financial Group are contending with weak demand for domestic loans as businesses keep a tight rein on spending. Growth, however, lies overseas, helped by European banks that have curtailed overseas investments.
Mizuho and other leading Japanese banks also have to absorb one-off charges related to a write-down of their deferred tax assets due to changes in Japan's tax code. Mizuho said the impact of the write-down was about US$315 million.
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Tags: Mizuho Financial Group, Mitsubishi UFJ Financial Group, Inc., Sumitomo Mitsui Financial Group
