The Japanese banking sector is performing badly compared with most other sectors of the economy. While many other large companies have recently been recording increased earnings, the major banks are still registering falling profits.
For instance, Sakura Bank Ltd, one of the largest banks, has reported profits for the two quarters ending 30 September 2000, down by 23% year-on-year at Yen 31.3 billion ($284.9 million). The effect of this fall was mitigated to some extent by cost cutting measures that allowed operating profits to rise by 8.8%.
During the same period Sumitomo Bank Ltd was able to report a 42% increase in profits to Yen 75.8 billion only after selling shares in Goldman Sachs Co. However, this did not prevent operating profits from falling by 9.8% year-on-year.
Sumitomo Bank Ltd and Sakura Bank Ltd have announced that they will merge in April 2002.
Financial Times
