Problem loans held by the nation's 142 banks totaled 73 trillion yen as of Sept. 30, edging up from 71.7 trillion yen logged six months earlier, according to a government report released Friday.
The 19 major banks — including the now-nationalized Long-Term Credit Bank of Japan and the Nippon Credit Bank — accounted for 51.3 trillion yen of the total, also up from 50.1 trillion yen as of March 31, the Financial Supervisory Agency said.
The figures indicate that the banks' efforts to write off their bad loans — a major drag on Japan's wobbly financial system — appear to have been insufficient.
But a senior FSA official did not blame the banks, noting that the financial watchdog will pay more attention to figures for the March end of this fiscal year. By that time, some banks are expected to receive trillions of yen in public funds to boost their capital bases.
The released figures are based on the banks' self-assessment of the quality of outstanding loans and their perceived degree of difficulty in collecting them.
The FSA had these banks classify loans into four categories, in accordance with the agency's definitions of healthy, problem and bad loans.
The 73 trillion yen is the tally of the "second-," "third-" and "fourth-category" loans held by all the banks. First-category loans are deemed "healthy," while the fourth category is defined as irrecoverable. Those in the third category are defined as "carrying a high possibility that lenders will incur losses."
The second category, falling into the gray area between the first and third, made up the biggest part of the problem loans. It came to 66.1 trillion yen, up from 65.5 trillion yen as of last March, accounting for 11.1 percent of their combined outstanding loans 598 trillion yen.