The market
for bad loans in Japan has been flourishing since 1997 when Japanese
government started cash infusions into major Japanese banks. Buyers
on the market have been the major foreign institutions that were
able to make returns over 20%.
Japan bad loans market current
situation
The
Japan bad loans market is currently slowing down has banks have achieved the
government target to halve
the amount
their bad loans by March 2005 compared to 3 years earlier to around 4% of their
total bad loans assets
Competition is fierce in this $ 2 Billion market between the buyers and
rate of returns are going
down to below 15%. However leverage is possible and can boost return in the 70%
range.
Future of bad loans market
The level
of the market is strongly influenced by political factors and it is difficult to
predict the market
will be in 2 or 3 years. However most analysts agree that the amount of bad
loans in major Japanese banks
is well above the official 6.2 Trillion Yen ($
70 Billion) reported in
March 2005 and that an
even bigger amount of
bad loans is held by different institutions in Japan.
How to participate in this market?
Japan Management Consulting has a strong experience helping new
entrants in this market
and can help you. Please contact us for further information