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The Bank of Japan’s decision to let long-term rates rise more has not sparked a boom in revenue from lending as the central bank has yet to end its policy of negative interest rates, the head of the country’s third-largest lender said on Thursday.
The comments from Masahiro Kihara, the president and CEO of Mizuho Financial Group, highlight the challenges Japanese banks still face even as the central bank’s surprise move last month sparked hopes of a windfall for lenders after years of being squeezed by rock-bottom rates.
Kihara also told Reuters that Mizuho, which is looking to expand its capital markets and digital finance capabilities in Asia, was considering a potential deal but he did not elaborate.
The Bank of Japan tweaked its bond yield control mechanism last month, presaging a potential end to years of massive stimulus and negative interest rates. Tokyo’s index of bank stocks has jumped 12% since, as investors bet that financial firms would benefit.
