Six major Japanese banks have decided not to take part in the Bank of Japan's first auction aimed at offering subordinated loans to help them bolster their capital, the Nikkei business daily reported.
They are Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking, Mizuho Corporate Bank, Mitsubishi UFJ Trust and Banking Corp, Sumitomo Trust & Banking and Mizuho Trust & Banking, the paper said, without citing any sources.
In March, the Bank of Japan decided to offer up to 1 trillion yen ($10.35 billion) in subordinated loans to bolster banks' capital depleted by stock price falls and prevent lending to companies from drying up.
The central bank said in April it would offer domestic banks up to 350 billion yen each in such loans at an interest rate to be set via auctions, the first of which was to be held by the end of May.
The six banks are now more inclined to raise capital from the capital markets, which have regained stability since March, the Nikkei said.
More banks are choosing to issue common stock and other instruments that can be counted toward core capital, whereas subordinated loans can be counted as supplementary capital, the paper said.
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