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Paper: Japan Banks Write Off $76.7B

April 1, 1998

TOKYO (AP) _ Japan’s 19 biggest banks will clean up their balance sheets by writing off a record 10.2 trillion yen ($76.7 billion) in bad loans, a leading financial daily reported Wednesday.

The amount is almost 2.5 trillion yen higher than previously expected and will force all nine top commercial banks to report pretax losses for the fiscal year ended Tuesday, the Nihon Keizai newspaper said.

Most of the writeoffs will have been paid for by selling off assets such as stock and real estate holdings, the newspaper said.

The move signals Japanese banks’ attempt to turn the corner on a problem which has weighed on their earnings for most of this decade.

Many of the property-backed loans on their ledgers went sour after the collapse of a speculative land price bubble at the outset of the 1990s.

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