The Japanese Banking Crisis of the 1990s: Sources and Lessons

47 Pages Posted: 30 Jan 2006

See all articles by Akihiro Kanaya

Akihiro Kanaya

International Monetary Fund (IMF) - Monetary and Exchange Affairs Department

David Woo

International Monetary Fund (IMF)

Date Written: January 2000

Abstract

For a large part of the past decade, Japan has witnessed a steady deterioration in the health of its banking system. This paper examines what went wrong and why it has taken so long for the system to recover. While the paper traces the roots of the crisis to accelerated deregulation and deepening of capital markets without an appropriate adjustment in the regulatory framework, it identifies weak corporate governance and regulatory forbearance as the two factors behind what might have been an unnecessary prolongation of the distress of the financial system.

Keywords: Japan, Banking Crisis, Bank Restructuring

JEL Classification: G21, G32

Suggested Citation

Kanaya, Akihiro and Woo, David, The Japanese Banking Crisis of the 1990s: Sources and Lessons (January 2000). IMF Working Paper No. 00/7, Available at SSRN: https://ssrn.com/abstract=879319

Akihiro Kanaya (Contact Author)

International Monetary Fund (IMF) - Monetary and Exchange Affairs Department ( email )

700 19th Street NW
Washington, DC 20431
United States

David Woo

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

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