Investors have never been in much love with Japan’s small banks. The prospect of a gradual move to clean up their balance sheets may change that.
Japanese regional banks don’t look like good investments: returns have been paltry and growth is nonexistent. Their small scale makes it hard to compete with the country’s megabanks, and Japan’s low interest rates and aging population just add to their problems. Shares of Japanese regional banks have nearly halved since 2015, according to FactSet.
