Disclosed problem credit at Japanese banks did not grow in the year to March 2026, but the cost of dealing with it did. The Financial Services Agency put the balance of claims disclosed under the Financial Reconstruction Act at ¥8.4tn at end-March 2026, the same as a year earlier. Disposal losses for the year were ¥0.5tn, up ¥0.3tn from ¥0.2tn.
The figures cover the 106 banks in the FSA's national-bank aggregate: city banks, former long-term credit banks (including SBI Shinsei and Aozora), trust banks and regional banks. Credit associations and credit cooperatives are reported separately and are not in these totals.
| Measure | March 2025 | March 2026 |
|---|---|---|
| Disclosed problem claims | ¥8.4tn | ¥8.4tn |
| Problem-claim ratio | 1.1% | 1.0% |
| Individual loan-loss reserves | ¥2.0tn | ¥1.9tn |
| Disposal losses (full year) | ¥0.2tn | ¥0.5tn |
A flat stock of problem claims
Within the ¥8.4tn, need-attention claims were ¥2.0tn, doubtful claims ¥5.3tn (up ¥0.1tn) and bankrupt or effectively bankrupt claims ¥1.1tn. The FSA's footnote defines need-attention claims as loans three months or more overdue, or loans whose terms were eased to support a borrower's restructuring. The ratio of problem claims to total credit was 1.0% for all banks, against 1.1% a year earlier. It was 0.6% at major banks (down from 0.7%) and 1.5% at regional banks (down from 1.6%).
Individual loan-loss reserves fell to ¥1.9tn from ¥2.0tn. Across all disclosed claims, collateral, guarantees and reserves together covered 80.1% of the balance, against 79.7% a year earlier. Reserves alone covered 28.0%, down from 29.1%.
Where the losses sit
The FSA's disposal-loss table gives ¥535.5bn for the year to March 2026, against ¥242.5bn the year before. The provision charge was ¥366.3bn, up from ¥61.4bn. Direct write-offs and similar items eased to ¥164.9bn from ¥177.7bn. Within that, the line for bulk-sale losses and similar items, which the FSA says also includes support losses on subsidiaries and losses on sales to the Resolution and Collection Corporation, was ¥66.3bn, against ¥79.5bn.
The increase was concentrated in the largest banks. For city banks, former long-term credit banks and trust banks, disposal losses were ¥315.2bn, against ¥52.9bn a year earlier. Their provision charge was ¥223.0bn, after a net reversal of ¥49.1bn the year before. The FSA's release and tables give no reason for the higher losses.
These are end-March 2026 observations and full-year flows to that date, not October balances. A flat stock alongside a larger loss line means the balance sheet and the income statement are telling different stories about the same year.