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Kyodo economic news summary -4-.

TOKYO, Sept. 16 Kyodo

---------- Lehman Brothers' Japan files for bankruptcy protection

TOKYO - Lehman Brothers Japan Inc. said Tuesday it has filed for bankruptcy protection with the Tokyo District Court following the collapse of its parent firm Monday, marking the second largest corporate failure in terms of debts in the postwar period in Japan.

The Japanese unit of U.S. securities house Lehman Brothers Holdings Inc., together with its Japanese holding company, invoked the Civil Rehabilitation Law.

---------- Lehman failure not to mar Japanese financial system: Ibuki

TOKYO - The Lehman Brothers Holdings Inc. bankruptcy will not seriously damage the Japanese financial system despite some institutions' exposure to the fourth-largest U.S. securities house, Finance Minister Bunmei Ibuki predicted Tuesday.

''Considering the conditions of each financial institution's self-owned capital, we do not have to worry about the Japanese financial system, though those entities have extended loans to Lehman,'' Ibuki said at a press conference.

---------- Mizuho Trust & Banking expects 11.8 billion yen loss on Lehman

TOKYO - Mizuho Trust & Banking Co. said Tuesday it expects to incur losses of 11.8 billion yen due to the failure of U.S. investment bank Lehman Brothers Holdings Inc.

The bank also said it has lowered its earnings forecast for the first half of fiscal 2008, trimming group net profit to 9 billion yen from an initial estimate of 21 billion yen.

---------- Lehman is in talks with Barclays to sell bulk of its firm: report

NEW YORK - Lehman Brothers Holdings Inc. was negotiating a last-minute plan to sell large portions of itself to the British bank Barclays PLC on Monday night, the Wall Street Journal reported.

The talks, headed by Barclays Americas Chairman Archibald Cox Jr., dealt with such problems as ''the fate of Lehman's toxic mortgage-security and real-estate assets, as well as the price that Barclays might pay for Lehman,'' the electronic edition of the paper said Monday.

---------- Japanese institutions' Lehman Brothers exposure put at $1.67 billion

TOKYO - Japanese financial institutions' exposure to failed U.S. securities house Lehman Brothers Holdings Inc. totals $1.67 billion, or 170 billion yen, the U.S. firm said in its bankruptcy court filings Monday.

A list of major creditors in the filings indicates Aozora Bank is the largest Japanese creditor with $463 million in outstanding loans. The bank said Tuesday its loss on the loans to Lehman Brothers could be limited to less than $25 million due to recoveries.

---------- Crude oil futures briefly hit $91 level after ending at $95 level

NEW YORK - The bellwether crude oil futures briefly plunged to the upper $91 level per barrel in New York during off-hours trading Monday, after finishing the day at the $95 level, on speculation about falling global demand.

The key October contract for West Texas Intermediate crude oil ended $5.47 lower from last Friday at $95.71 on the New York Mercantile Exchange, ending below the $100 line for the first time since early March on expectations of stable supply. The contract later briefly entered the $91 level for the first time since early February.

---------- BOJ begins policy meeting amid fears of financial turmoil

TOKYO - The Bank of Japan began a two-day policy meeting Tuesday amid growing fears of global financial turmoil after the bankruptcy of Lehman Brothers Holdings Inc.

The Japanese central bank is largely expected to keep its key short-term interest rate target steady at 0.5 percent at the end of its Policy Board meeting Wednesday, given rising inflation and slowing growth.

---------- Nikkei dives nearly 5% to 3-yr low on Lehman Brothers failure

TOKYO - Tokyo stocks plummeted Tuesday, with the key Nikkei index diving nearly 5 percent to its lowest level in more than three years, as the failure of major U.S. securities house Lehman Brothers Holdings Inc. stunned investors and pushed them away from buying risky assets such as stocks.

The 225-issue Nikkei Stock Average lost 605.04 points, or 4.95 percent, from Friday to 11,609.72, its lowest closing level since July 8 in 2005 when it closed at 11,565.99.
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Publication:Japan Weekly Monitor
Date:Sep 22, 2008
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