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Mix-Ansicht- Schumpeter lacht: Japan bestellt Reichsverweser Takeshi Kimura (E) - El Sheik, 02.10.2002, 09:27
- Es passiert wirklich etwas: Neue Transparenz bei japanischen Bankkrediten (E) - El Sheik, 02.10.2002, 09:38
Es passiert wirklich etwas: Neue Transparenz bei japanischen Bankkrediten (E)
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Wednesday, October 2, 2002
RATING: UFJ Bank Provides In-House Credit Rating Data To Hike Rates
TOKYO (Nikkei)--UFJ Holdings Inc. (8307) reported the second-worst gross margin among Japan's big four banking groups for the year ended March 2002.
In an interview with the Nikkei Financial Daily, Masanobu Nakamura, a senior managing director of UFJ Bank, the core bank of the group, talked about efforts to raise interest rates in a bid to improve earnings.
The following are excerpts from the interview:
Q: Why is UFJ Bank publishing in-house ratings of loans to corporate borrowers?
A: We classify corporate clients into 10 categories on the basis of an inspection manual drawn up by the Financial Services Agency.
The first to seventh categories are regarded as sound loans; the eighth category comprises performing loans, which nonetheless are causing some concern; the ninth category represents loans deemed difficult to recover; and the tenth category covers irrecoverable loans.
We are now providing this data to clients. Currently, there are some 4,000 clients for which our in-house ratings are available. Of those, we notified 500 companies, which our branch managers felt would benefit from knowing their ratings, by the end of September.
Q: How did corporate borrowers respond to the disclosure?
A: Although some bank staff cautioned against revealing the in-house credit ratings to clients, 80% of the companies concerned gave us a positive response.
Some clients asked for advice on how to improve their ratings, while others became more willing to provide business data to us. We only received complaints from some 10 companies, who charged that the ratings did not accurately reflect the characteristics of their industries.
Q: How are you revising interest rates?
A: We have set a standard rate for each category. For instance, we charge an annual rate of less than 1.5% for uncollateralized loans for a period of less than one year extended to the first category, while the rate is around 2% for similar loans to the fifth category. We are asking clients, who are currently paying lower interest than our standard rate, to accept a higher rate.
Q: Why hasn't UFJ Bank published the in-house ratings of all the corporate clients that have been asked to pay higher interest rates?
A: Some 20,000 companies are paying lower interest than the standard rate and many of them have not been notified of their ratings.
All we can do to persuade firms into paying higher interest is to help resolve problems facing corporate clients.
We established a customer solution database in January this year, when UFJ Bank was created through the merger between Sanwa Bank and Tokai Bank.
The database is divided into 18 sections, such as overseas expansion and asset reduction. We identify business problems facing each client and grade the level of our assistance into seven categories.
Q: How successfully has UFJ Bank been in getting clients to accept a higher interest rate?
A: The average interest rate for 20,000 firms, which were paying lower interest than our standard rate, has risen by more than a 0.2 percentage point, compared with January. We aim to raise the margin by an additional 0.3 point by the end of next March, which will boost gross margin by 50 billion yen for the year.
In addition, we have seen an increase in non-interest revenue, as we bolstered operations designed to help clients solve their business problems.
Non-interest revenue accounted for 27% of the combined total revenue from deposit/lending operations and non-interest businesses in the first half of this fiscal year, compared with 23% in the same period last fiscal year.
(The Nikkei Financial Daily Wednesday edition)
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