Risk Japan: Bank of Japan concerned about wrong-way risk on banks’ cross-holdings

Helping banks by purchasing stock will create moral hazard, says Bank of Japan director-general


The Bank of Japan is concerned about wrong-way risk on Japanese banks' cross-holdings which has left banks nursing balance sheet losses as Japanese stocks have suffered from the negative effects of the eurozone crisis, according to Atsushi Miyanoya, director-general at the Bank of Japan (BoJ).

Speaking at the Risk Japan conference in Tokyo last week, Miyanoya explained that major Japanese banks have cross-holdings of more than 10 trillion yen ($124 billion) in fellow domestic corporates - a

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Credit risk & modelling – Special report 2021

This Risk special report provides an insight on the challenges facing banks in measuring and mitigating credit risk in the current environment, and the strategies they are deploying to adapt to a more stringent regulatory approach.

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