Japan Banks Struggling over Defense Investments, Loans

Tokyo, Sept. 7 (Jiji Press)--Japanese major banks and other private-sector financial institutions are struggling to meet the government's calls for cooperation in providing investments and loans to the defense industry.

The government-held Development Bank of Japan has changed its operational rules on investments in arms manufacturers, abolishing restrictions.

While a megabank official said that investments and loans will be decided on a "case-by-case" basis, commercial financial institutions generally remain cautious out of concerns over a possible deterioration in their corporate image and the impact on their overseas businesses, especially in China.

In July, Defense Minister Shinjiro Koizumi at a discussion session with the Japanese Bankers Association and others called for more investments and loans to the defense industry.

"In order to continue business in the defense industry and achieve growth, it is vital to receive investments and loans at appropriate times," he said.

[Copyright The Jiji Press, Ltd.]