Innovations in Financial Markets and Institutions

Crisis and Change in the Japanese Financial System

Editors: Hoshi, Takeo, Patrick, Hugh (Eds.)

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About this book

At the start of the twenty-first century, the Japanese financial system is undergoing a major transformation. This process is spurred by a sense of crisis. Dominated by large institutions, the Japanese banking system has suffered from serious problems with non-performing loans since the early 1990s, when the Japanese stock market and urban real estate market both crashed. Delays in responding to these twin asset bubbles, by both regulatory authorities and the banks themselves, made matters worse and led to a banking crisis in late 1997 and early 1998. Not anticipating this setback, in late 1996 the Japanese government inaugurated its Big Bang of comprehensive financial deregulation designed to complete the process of creating `free, fair, and open financial markets'. Beginning in late 1998 and early 1999 the government finally embarked on a major rehabilitation of the Japanese banking system, including making available some Yen 60 trillion (approximately USD 500 billion) of government funds to recapitalize fifteen major banks, adequately fund the deposit insurance program, and write off the bad loans of nationalized or bankrupted banks. One result of this reform process is that the Ministry of Finance (MOF), which dominated Japanese financial system policy for most of the post-war period, has been stripped of most of its former regulatory powers.
The purpose of this book is to describe, analyze, and evaluate the process that is transforming the Japanese financial system. The chapters address various issues relating to the transition of the Japanese financial system from a bank-centered and relationship-based system to a competitive market-based system. Questions taken up include: Why did Japanese banks get into such serious trouble? Why has the MOF lost its immense power? How will the Big Bang's financial deregulation further change the Japanese financial system, including the huge government financial institutions and postal savings system? What are some of the broader implications of this transition?
The book is divided into three parts: Part I considers the origins of Japan's banking crisis; Part II focuses on five particularly important areas of major actual and potential changes; Part III addresses the effects of the Big Bang, including its potential systemic externalities. Taken together, this book offers an unusually up-to-date, comprehensive and thorough appraisal and evaluation of the profound changes occurring in Japan's financial system.

Table of contents (13 chapters)

  • The Japanese Financial System: An Introductory Overview

    Hoshi, Takeo (et al.)

    Pages 1-33

  • What Caused Japan’s Banking Crisis?

    Cargill, Thomas F

    Pages 37-58

  • Causes of Japan’s Banking Problems in the 1990s

    Ueda, Kazuo

    Pages 59-81

  • The Stagnant Japanese Economy in the 1990s: The Need For Financial Supervision to Restore Sustained Growth

    Ito, Takatoshi

    Pages 85-107

  • The Reorganization of Japan’s Financial Bureaucracy: The Politics Of Bureaucratic Structure and Blame Avoidance

    Hiwatari, Nobuhiro

    Pages 109-136

Buy this book

eBook $189.00
price for USA (gross)
  • ISBN 978-1-4615-4395-4
  • Digitally watermarked, DRM-free
  • Included format: PDF
  • ebooks can be used on all reading devices
  • Immediate eBook download after purchase
Hardcover $329.00
price for USA
  • ISBN 978-0-7923-7783-2
  • Free shipping for individuals worldwide
  • Usually dispatched within 3 to 5 business days.
Softcover $239.00
price for USA
  • ISBN 978-1-4613-6977-6
  • Free shipping for individuals worldwide
  • Usually dispatched within 3 to 5 business days.
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Bibliographic Information

Bibliographic Information
Book Title
Crisis and Change in the Japanese Financial System
Editors
  • Takeo Hoshi
  • Hugh Patrick
Series Title
Innovations in Financial Markets and Institutions
Series Volume
12
Copyright
2000
Publisher
Springer US
Copyright Holder
Springer Science+Business Media New York
eBook ISBN
978-1-4615-4395-4
DOI
10.1007/978-1-4615-4395-4
Hardcover ISBN
978-0-7923-7783-2
Softcover ISBN
978-1-4613-6977-6
Edition Number
1
Number of Pages
XIII, 321
Topics