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3 Major Japanese Banking Groups Return to Profitability


Three of Japan's top banking groups say they were in the black for the first half of the fiscal year. A rallying economy is getting credit for helping Mitsubishi Tokyo, Mizuho, and Sumitomo Mitsui turn a profit. The three now are expected to meet a government deadline to halve their bad-loan portfolios by March 2005.

But a fourth bank, UFJ, has posted a group net loss of more than $6.5 billion for the period April-through-September.

UFJ Holdings President Ryosuke Tamakoshi says the bank intends to solve its bad-loan problems by the end of this fiscal year and hopes to have the ratio down below four percent by the end of March.

Analysts say all four banks are still in a slump, with their combined operating profit shrinking more than 13 percent compared to the same period last year.

Japan's trade surplus grew nearly nine percent in October from the same month last year. The Finance Ministry credits the leap to record exports, which surged nearly 12 percent overall. Exports to China in October jumped 20 percent and surpassed $7 billion, the largest amount ever.

A steel shortage is forcing Japan's second-largest automaker Nissan to close operations at three of its four domestic plants that make cars and trucks.

Nissan says it will stop work only for five days next week and in December (Nov. 29-Nov. 30 and Dec 6-Dec. 8). But analysts warn Nissan might fail to meet its current profit forecast.

Rival automakers, including Toyota, Honda and Mazda, say they are not facing a steel shortage.

Suzuki Motor, the top maker of mini-vehicles in Japan, is recalling its Escudo sport utility vehicle. It wants to replace faulty fuses in the model's air conditioners, which it says could start fires. The recall affects 160,000 cars.