MNI BRIEF: Japan Corp. Loan Demand Falls - BOJ Survey

Demand for financing by Japanese businesses via banks fell from three months ago, indicating the fund-raising environment remained accommodative, a survey on bank lending practices released by the Bank of Japan showed on Thursday.

The index for corporate fund demand -- calculated by subtracting the number of banks reporting a decline in lending from the number of those reporting an
increase – fell to +4 in July from +7 in April. The index for fund demand expected for the next three months stood at +4, down from +7 from the previous survey, indicating that fund demand will not strengthen on the back of a recovering economy despite high costs.

The index for demand from large companies stood at +3, down from +5 in April, and the index for smaller businesses stood at -1, also down from +3. Major firms attributed the drop of fund demand to decreases of sales and capital investment as well as a shift to other sources and smaller firms attributed the drop to increases in internally-generated funds and a shift to other sources.