Trends in Syndicated Loans and Related Regulations in Japan

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1. Trends in syndicated loans
The value of syndicated loans in Japan has been increasing in much the same way as in other countries. For borrowers, syndicated loans are large and flexible funding vehicles, and for lenders it is a business with a controlled credit risk, and which generates a high loan margin income. For financial institutions in Japan, where the Bank of Japan’s long-term low interest rate and easy monetary policy creates an unprofitable environment, overseas business centered on the U.S. syndicated loan markets, which generates a large fee pool, is an important source of income and it was recently reported that the number of syndicated loans managed by Japanese financial institutions to U.S. corporations in 2021 was approximately three times that of 10 years earlier…