Japan banks cautious in Europe dealings

Japanese banks have become increasingly vigilant about trades with European banks, the chairman of the Japanese Bankers Association said Thursday, as concerns mount about credit risks at the region's financial institutions. Katsunori Nagayasu, also president of Mitsubishi UFJ Financial Group, added that he did not believe Tokyo Electric Power's (Tepco) creditor banks would have to waive debt to the operator of the crippled Fukushima nuclear plant, since a scheme to compensate victims of the radiation crisis would help it to remain solvent. Nagayasu said Japanese banks had been very careful even in normal circumstances in dealings with individual European banks as necessary, but had been taking a cautious stance toward European banks overall since July. "We have become more vigilant in our operations lately," he told a regular news conference of the bankers' association.