The willingness of banks to extend loans to small and midsize companies stayed at its lowest level in at least eight years as lenders hoarded funds on signs that the economy is in a recession, the Bank of Japan said Tuesday.
An index of willingness to lend money to smaller companies was at 5 this month, unchanged from July, the BOJ said in a quarterly survey of loan officers. The BOJ started the survey in April 2000.
Business failures rose at the fastest pace in eight years in September, led by construction and real estate companies that struggled to obtain funding.
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