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# Explanation of "Principal Figures of Financial Institutions"

June 2018
Bank of Japan
Financial System and Bank Examination Department

## Basic Information

Compilation section: Banking Statistics Group, Financial Data Division, Financial System and Bank Examination Department

Frequency of compilation: Monthly basis

Time of release: Beginning of next month

Method of release: Bank of Japan's web site

Publications: Financial and Economic Statistics Monthly and Bank of Japan Statistics

## 1. Summary

From July 1991, the Bank of Japan has compiled "Principal Figures of Financial Institutions" to gauge developments in banks' deposits and loans, and it releases preliminary figures for each month at the beginning of the following month.

Since the figures are preliminary, the released data may be revised afterward. If you refer to the figures each month, please also check for revised data using the BOJ Time-Series Data Search.

## 2. Definition

"Principal Figures of Financial Institutions" consists of (1) loans and discounts and (2) deposits and certificates of deposit (CDs). The details are as follows.

### (1) Loans and discounts (average amount outstanding)

Loans and discounts comprise funds provided by financial institutions to borrowers for business operations and other purposes. The objective of the statistics is to collect information on loans that contribute to domestic economic activity. These loans are extended to residents (entities conducting economic activity in Japan) from domestic banks (city banks, three trust banks [Mitsubishi UFJ Trust and Banking Corporation, Mizuho Trust & Banking Co., and Sumitomo Mitsui Trust Bank], Saitama Resona Bank, Shinsei Bank, Aozora Bank, regional banks I and regional banks II, other surveyed domestically licensed banks [Japan Post Bank Co., Sony Bank, SMBC Trust Bank, ORIX Bank Corporation, and JSF Trust and Banking Co.]), and shinkin banks. Since the objective of the statistics is to collect information on loans that contribute to economic activity of the private nonfinancial sector, loans extended to financial institutions and the central government are excluded.

The statistics are compiled on an average amount outstanding basis. The average amount outstanding is calculated by adding up the amounts outstanding for each day and dividing the figure by the number of days in a month. In this way, the fluctuations in the amount outstanding due to factors such as seasonal variations can be averaged.

### (2) Deposits and CDs (average amount outstanding)

Real deposits are deposits that exclude unsettled checks and bills from nominal deposits. CDs are deposits that are transferable to a third party.

Nominal deposits refer to financial institutions' deposits in the banking book, that is, overall deposits including cash brought in by depositors and checks and bills that will be paid out by different financial institutions. However, unsettled checks and bills to be paid out by different financial institutions cannot be used until they are cashed. Therefore, in "Principal Figures of Financial Institutions," unsettled checks and bills are excluded from nominal deposits. Figures for real deposits are compiled on an average amount outstanding basis for city banks (including Saitama Resona Bank), regional banks I and regional banks II, and other surveyed domestically licensed banks (Mitsubishi UFJ Trust and Banking Corporation, Mizuho Trust & Banking Co., Sumitomo Mitsui Trust Bank, Shinsei Bank, Aozora Bank, Japan Post Bank Co., The Japan Net Bank, Sony Bank, SMBC Trust Bank, and ORIX Bank Corporation).

## 3. Similar data

Similar data such as the preliminary figures for banks' deposits and loans are released by the Japanese Bankers Association (available only in Japanese), and "Deposits, Vault Cash, and Loans and Bills Discounted" is released by the Research and Statistics Department of the Bank of Japan. Please note the differences in the types of financial institutions surveyed and the categories, and refer to "Table of Comparison of 'Deposits' and 'Loans' in Statistics Prepared by the Bank of Japan."

### Reference 1: Figures after adjustment for special items (available only at the BOJ Time-Series Data Search)

At the BOJ Time-Series Data Search, the average amount outstanding of loans after adjustment for special items is available, together with the data for "Principal Figures of Financial Institutions." Figures after adjustment for special items refer to the estimated figures for the amount outstanding of loans after adjustment for special items during the past year. The year-on-year rate of change after adjustment is calculated as shown below. The calculations are based on several assumptions, and thus should be interpreted with some latitude.

Amount outstanding after adjustment for special items (bil. yen)
= amount outstanding before adjustment + (1) exchange rate changes + (2) loan write-offs and related items + (3) securitization of loans + (4) other special items

Year-on-year rate of change (percent)
= (amount outstanding of loans of the month after adjustment for special items - amount outstanding of loans a year ago before adjustment) / amount outstanding of loans a year ago before adjustment

#### (1) Adjustment for exchange rate changes

To exclude the effects from changes in the exchange rates, the amount outstanding of loans of the month is adjusted by converting foreign currency-denominated loans of the month into the yen, based on year-to-year U.S. dollar/yen rate changes.

#### (2) Adjustment for loan write-offs and related items

Loan write-offs cause a decline in the nominal amount of loans on financial institutions' balance sheets, but the actual amount of loans extended to borrowers does not change. Therefore, the total amount of loan write-offs in the past year, including those through special reserves, losses on loan asset sales to the Cooperative Credit Purchase Corporation (dissolved in March 2004), other losses on loan asset sales, renunciation of loan claims, and sales prices of nonperforming loans, is added to the amount of loans of the month.

#### (3) Adjustment for securitization of loans

As with the adjustment for loan write-offs and related items, securitization of loans does not indicate changes in the actual amount outstanding of loans, and thus the amount outstanding is adjusted by adding the difference in the amount outstanding of securitized loans from the previous year to the amount outstanding of total loans of the month.

#### (4) Other special items

From October 1998, figures for loans extended to the former Japanese National Railway (JNR) Settlement Corporation were adjusted by excluding the extended loans from the survey results (loans taken over by the central government were excluded from the aggregate amount of loans) and adding the amount of extended loans to the amount outstanding of total loans of the month. However, this adjustment was terminated in October 1999 because the figures do not include loans extended to the former JNR Settlement Corporation in and after October 1998.

From April 1999, figures for loans extended to the former Housing Loan Administration Corporation were adjusted by excluding the extended loans from the survey results (loans transferred to the Resolution and Collection Corporation were excluded from the aggregate amount of loans) and adding the amount of extended loans to the amount outstanding of total loans of the month. However, this adjustment was terminated in March 2000 because the figures do not include loans extended to the former Housing Loan Administration Corporation in and after April 1999.

### Reference 2: Issuance of CP

The Bank abolished the category "Issuance of CP" in "Principal Figures of Financial Institutions" in April 2013. The past data for issuance of CP are available at the BOJ Time-Series Data Search.

For figures on the issuance of CP, Japan Securities Depository Center, Inc. releases "Outstanding Amounts of CP by Issuer's Category."

### Reference 3: Bank debentures and loan trusts

The Bank abolished the category "Bank Debentures and Loan Trusts" in "Principal Figures of Financial Institutions" in April 2013.

The Japan Securities Dealers Association releases figures for bank debentures in "Issuing, Redemption and Outstanding Amounts of Bonds." The Trust Companies Association of Japan releases figures for loan trusts (available only in Japanese).