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▼ Creditors to Support Toshiba Until End-Feb.
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TOKYO (Jiji Press) — Creditor financial institutions for Toshiba Corp. on Monday reached a broad agreement to continue loans to the struggling Japanese electronics and machinery giant until the end of next month.
Most of them, including the three main creditor banks — Sumitomo Mitsui Banking Corp., Mizuho Bank and Sumitomo Mitsui Trust Bank — and Bank of Tokyo-Mitsubishi UFJ, will continue support for Toshiba, while only several institutions expressed objections.
At a meeting on Jan. 10, Toshiba requested its creditors to maintain their loans until the end of February, with a deadline for their decision set for Monday.
Toshiba may possibly book a loss of up to ¥700 billion from its nuclear power plant business in the United States.
The main creditor banks plan to call on Toshiba to step up streamlining efforts, given that some institutions are cautious about financing to the firm due to concerns about its financial health following the possible huge loss, sources said.
The number of Toshiba’s creditor financial institutions stands at some 80, including regional banks, life insurers and the government-affiliated Development Bank of Japan, on top of the three main creditors and other major banks.
Their combined loan balance came to about ¥800 billion as of the end of September 2016, with major banks, including the three main institutions, accounting for more than half of the total.
The total balance is seen to be maintained until the end of February, with loans by creditors opposing the agreement unlikely to be repaid immediately under the terms of contracts.
Following recent downgrades in Toshiba’s credit ratings, the company may end up failing to meet conditions for loans set by its creditors. Toshiba and its creditors have held discussions as the company could be requested to make immediate loan repayments in such event.
The creditors will study future support measures after figuring out the total size of Toshiba’s U.S. nuclear business loss and its reconstruction plan.
Most of them, including the three main creditor banks — Sumitomo Mitsui Banking Corp., Mizuho Bank and Sumitomo Mitsui Trust Bank — and Bank of Tokyo-Mitsubishi UFJ, will continue support for Toshiba, while only several institutions expressed objections.
At a meeting on Jan. 10, Toshiba requested its creditors to maintain their loans until the end of February, with a deadline for their decision set for Monday.
Toshiba may possibly book a loss of up to ¥700 billion from its nuclear power plant business in the United States.
The main creditor banks plan to call on Toshiba to step up streamlining efforts, given that some institutions are cautious about financing to the firm due to concerns about its financial health following the possible huge loss, sources said.
The number of Toshiba’s creditor financial institutions stands at some 80, including regional banks, life insurers and the government-affiliated Development Bank of Japan, on top of the three main creditors and other major banks.
Their combined loan balance came to about ¥800 billion as of the end of September 2016, with major banks, including the three main institutions, accounting for more than half of the total.
The total balance is seen to be maintained until the end of February, with loans by creditors opposing the agreement unlikely to be repaid immediately under the terms of contracts.
Following recent downgrades in Toshiba’s credit ratings, the company may end up failing to meet conditions for loans set by its creditors. Toshiba and its creditors have held discussions as the company could be requested to make immediate loan repayments in such event.
The creditors will study future support measures after figuring out the total size of Toshiba’s U.S. nuclear business loss and its reconstruction plan.
- February 2, 2017
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