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Japanese banks tumble again
TOKYO, Japan -- Bank stocks sold off hard on Monday morning, with the government increasingly talking tough on bad debt disposal. Stocks of troubled borrowers also took a hammering, as investors bet the administration will crack down on banks' most problematic customers. Economics Minister Heizo Takenaka last week appointed a noted hardliner to his bank task force. That group is due to report on the problem next week. Takenaka has been talking tough on the issue himself, saying that no bank is too large for the government to let it collapse. No bank 'too big' to fail"Big banks have their merits. They enjoy economies of scale, which can strengthen their financial base. But we do not hold the idea that they are too big to fail," he said in a Newsweek magazine interview published on its Web site. That tack would pose a threat to good corporate governance and amounts to a "moral hazard," he explained. Embattled retailer Daiei Inc. is reeling on Monday. Its shares are topping the losses on the Tokyo Stock Exchange, down 25.6 percent at 93 yen at the morning break. Bank UFJ Holdings, seen as the weakest big bank, broke for lunch down 8.72 percent to 199,000 yen. It retouched its record low of 194,000 yen in morning trade. Sumitomo Mitsui Banking Corp. is faring even worse, down 9.38 percent to 512 yen at lunch. Mizuho Holdings, which suffered heavy selling last week, ended the session off 5.66 percent to 199,000 yen. Mitsubishi Tokyo Financial Group, generally regarded as the healthiest of the Big Four, is down 6.16 percent at 792,000 yen. BOJ accord neededAccording to reports from the World Economic Forum in Malaysia, Takenaka said the government needed an accord with the Bank of Japan to tackle deflation, possibly including inflation targets. Japan's overall market is also suffering after the Dow Jones industrial average hit a five-year low on Friday. The Nikkei 225 average is down 3.46 percent at 8,715.59 at the lunch break, after the Dow fell 2.45 percent on Friday to end at 7,528.40.
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