Bank of Kyoto Ltd., the biggest corporate shareholder in video-game maker Nintendo Co., said it will keep stakes in Japanese exporters to protect its commercial lending business, even as larger rivals including Mizuho Financial Group Inc. cut stockholdings.

"The strength of a bank's relationship with a client is heavily decided by the stake it holds," said bank President Yasuo Kashihara. "The custom to share out loans to banks based on shareholdings is still very strong in Japan."

Stockholdings helped cause $13 billion in losses at Mizuho, Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. in fiscal 2008, when the bourse slumped 36 percent. Kashihara said cutting his bank's stock investments would be shortsighted and thus he may broaden them to win more business.

The lender has a 4.5 percent stake in Nintendo, the world's biggest maker of portable video-game players. Kashihara did not comment on lending to specific companies. Nintendo is also based in Kyoto.

Bank of Kyoto held ¥493.5 billion in shareholdings at the end of March, including stakes in electronic components maker Kyocera Corp. and Nidec Corp., a maker of hard-disk drive motors. It had an unrealized profit of ¥312 billion on the shares last fiscal year, according to its annual financial statements.

Mizuho and its rivals risk "hollowing out" their business relationships with corporate clients, he said.

Bank of Kyoto's shares have fallen 2.5 percent since the start of the year, compared with a 0.3 percent fall in the Topix Banks Index.