February 1, 2002
Financial Services Agency

The Status of Non Performing Loans as of September 2001 (The Point)

1. The Status of Non Performing Loans (NPLs)

(1)	Classified assets based on the Financial Reconstruction Law (FRL)     The existing classified assets under the FRL held by all banks amounted to ¥36.8 trillion as of the end of September 2001, an increase of ¥3.1 trillion from ¥33.6 trillion as of the end of March 2001. This increase is principally due to an increase in restructured loans in ''need special attention'' loans as a result of the application of stricter classification criteria by banks that had undergone the first round of inspections based on the Financial Inspection Manual of the Financial Services Agency. The amounts of doubtful loans and bankrupt loans slightly increased because of the new loans classified as such due to reasons including business aggravation of borrowers, in spite of aggressive removal of these assets from balance sheets of banks.
(2)	Non Performing Loan (NPLs)     The existing NPLs held by all banks amounted to ¥35.7 trillion as of the end of September 2001, an increase of ¥3.2 trillion from ¥32.5 trillion as of the end of March 2001. This increase is also principally due to an increase in restructured loans as a result of the application of stricter classification criteria by banks. The amounts of past due loans and loans to debtors in legal bankruptcy slightly increased because of the new loans classified as such due to reasons including business aggravation of borrowers, in spite of aggressive removal of these loans from balance sheets of banks.

2. The Status of Specific Allowance for Loan Loss

As of the end of September 2001, although the amount of loans for which specific allowance is required (i.e., doubtful loans and bankrupt loans of classified assets based on the FRL and past due loans and loans to debtors in legal bankruptcy of the NPLs) held by all banks increased, the amount of the specific allowance for loan loss amounted to 7.1 trillion yen, remaining nearly on the same level of ¥7.2 trillion as of the end of March 2001. This is because bankrupt loans that requires higher rates of allowance decreased while doubtful loans (past due loans) that require relatively lower rates of allowance increased.

3. The Status of Loss on Disposal of NPLs

The Loss on disposal of NPLs as of September 2001 amounted to ¥3.0 trillion, an increase of ¥0.7 trillion from September 2000.

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• The Status of Non Performing Loans held by All Banks (as of the end of September 2001)
• Self-Assessment Result of Asset Quality of All Banks based on the Financial Reconstruction Law (as of the end of the September 2001)
• Risk Management Loans of All Banks (as of the end of September 2001)
• Loss on Disposal of Bad Loans of All Banks

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(PDF format)

• The Status of Non Performing Loans held by All Banks (as of the end of September 2001)
• Self-Assessment Result of Asset Quality of All Banks based on the Financial Reconstruction Law (as of the end of the September 2001)
• Risk Management Loans of All Banks (as of the end of September 2001)
• Loss on Disposal of Bad Loans of All Banks