Tokyo banks on rise as bad debt down

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The renewed focus on lenders came after a report in the Japanese Press suggested that Bank of Tokyo-Mitsubishi, the main division of Japan's numberthree banking group, Mitsubishi Tokyo Financial, had halved its ratio of non-performing loans.

If true, that would put them towards the top of the 3% range, sharply lower than the 7.91% at the end of the 2001 financial year. It would also mean Mitsubishi Tokyo Financial was a more than a year ahead of schedule in its clean-up efforts.

Although a bank spokesman declined to comment on the seemingly positive figures, the bank's shares picked up 31,000 yen or 4.7% to 696,000 yen. The feel-good factor spread to the rest of the sector as Mizuho Financial rose 7000 yen or 3% to 234,000; UFJ 3000 or 0.7% to 433,000; and Sumitomo Mitsui Financial firmed 5000 yen or 1.1% to 457,000.

Car makers were less fortunate amid concern both about the continued strength of the yen and the lack of intervention by the authorities. It has been more than a week since the Group of Seven altered the market's views of the yen-dollar rate in favour of a stronger yen, but thus far from Japan there has been no conclusive action.

As the Japanese currency hovered close to three-year highs Toyota dropped 40 yen or 1.2% to 3350; Nissan shed 14 yen or 1.2% to 1207; and Honda was thumped by 220 yen or 4.7% to 4460. Consumer electronics exporters were not spared. Sony backtracked 110 yen or 2.8% to 3890, while Matsushita Electrical Industrial was weaker by 26 yen at 1330, a decline of 1.9%.

The Nikkei 225 Average fell 88.87 points to close at 10,229.57. Brokers said Wall Street's softness at the end of last week also provided impetus for the lower prices.

Hong Kong's Pacific Century Cyberworks, owner of the city's fixed-line network, advanced a welcome five cents or 1% to HK$5.20. Brokers said the group, headed by Richard Li, could benefit from greater access to the Chinese market under a new accord set to be unveiled on Monday as part of a broader trade agreement pushed by Beijing to stir a revival in the territory's economy. However, most provisions relate to manufacturing, less important than services.

Elsewhere profit-takers moved in. Lender Hang Seng Bank, up sharply last week, dropped HK$1.50 or 1.6% to HK$92.75. Developer Cheung Kong, another recent gainer, fell 50 cents or 0.8% to HK$61.25. The Hang Seng index fell 135.45 points or 1.2% to 11,154.70.

In South Korea chipmaker Samsung Electronics was pulled lower by the stronger won, combined with profit-taking. In addition, a weekend report of a possible probe at parent Samsung Group added to the selling pressure. The company's shares eased 7000 won or 1.8% to 381,000. The Seoul Composite slipped 7.02 points or 1% to 690.38.

Australian takeover target Peter Lehmann Wines, hunted by Britain's Allied Domecq and Switzerland's Hess Group, hovered above Allied's latest A$4-a-share offer price. It traded at A$4.03, down one cent. The All Ordinaries fell 3.8 points or 0.12% to 3171.9.