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Lessons from Japan’s Banking Crisis

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  • Masahiro Kawai
  • Mariko Fujii

Abstract

The Japanese government’s response to the financial crisis in the 1990s was late, unprepared and insufficient; it failed to recognize the severity of the crisis, which developed slowly; faced no major domestic or external constraints; and lacked an adequate legal framework for bank resolution. Policy measures adopted after the 1997–1998 systemic crisis, supported by a newly established comprehensive framework for bank resolution, were more decisive. Banking sector problems were eventually resolved by a series of policies implemented from that period, together with an export-led economic recovery. [ADBI Working Paper 222]

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  • Masahiro Kawai & Mariko Fujii, 2010. "Lessons from Japan’s Banking Crisis," Working Papers id:2992, eSocialSciences.
    • Handle: RePEc:ess:wpaper:id:2992
    Note: Institutional Papers
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    References listed on IDEAS

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    1. Masahiro Kawai, 2005. "Reform of the Japanese banking system," International Economics and Economic Policy, Springer, vol. 2(4), pages 307-335, December.
    2. Mr. Fabian Valencia & Mr. Luc Laeven, 2008. "Systemic Banking Crises: A New Database," IMF Working Papers 2008/224, International Monetary Fund.
    3. Hoshi, Takeo & Kashyap, Anil K, 2010. "Will the U.S. bank recapitalization succeed? Eight lessons from Japan," Journal of Financial Economics, Elsevier, vol. 97(3), pages 398-417, September.
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    Cited by:

    1. Jiří Štekláč & Vladimír Štípek, 2017. "Smoothing Out The Credit Cycle Under The Conditions Of Current Credit Economy," Economy & Business Journal, International Scientific Publications, Bulgaria, vol. 11(1), pages 526-546.
    2. Mohaddes, Kamiar & Raissi, Mehdi & Weber, Anke, 2017. "Can Italy grow out of its NPL overhang? A panel threshold analysis," Economics Letters, Elsevier, vol. 159(C), pages 185-189.

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    Keywords

    Japanese; financial crisis; domestic; framework; policies;
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