Deposit Levy at 20-Year Low Helps Japan Banks as Economy Falters
Pedestrians are reflected in a window in front of a stock board outside a securities firm in Tokyo.
Photographer: Tomohiro Ohsumi/BloombergThis article is for subscribers only.
The state-run fund that bailed out Japan’s banks with taxpayer money from the end of the 1990s is now so flush with cash that it is cutting what it charges lenders to protect savers.
The Deposit Insurance Corp. of Japan lowered to 4.2 basis points from 8.4 basis points what it charges banks to insure deposits and then uses as a reserve to rescue failed lenders. The cut to the lowest rate since early 1996 reflects the recovery of the local financial system, and will boost banks’ profits, though the savings probably won’t spur lending, according to BNP Paribas SA and Keefe Bruyette & Woods Inc.