Lending by Japanese banks fell 0.1 percent in 2005 after adjustment for special factors, marking the smallest drop since the Bank of Japan started tracking the data in 1999, the central bank said Thursday.
Although the average daily balance of bank lending has now fallen for seven years in a row, the result indicates that financial institutions are becoming more eager to lend in line with the economy's recovery.
The loan balance, which excludes loans by "shinkin" credit banks that cater mainly to small and midsize local businesses, was adjusted for three special factors: loan securitization, exchange-rate fluctuations and the allocation of loan-loss reserves.