TOKYO (AP) -- The Bank of Tokyo-Mitsubishi Ltd. said Monday it will pay back public funds borrowed under a government bailout program two years ago, becoming the first bank to do so.
Japan's largest commercial lender said in a statement it will repurchase $904.3 million in subordinate bonds from the government-backed Resolution and Collection Corp. on Feb. 28.Though it was not obliged to pay back the money for at least five years, the bank decided to do so this month after judging its capital-adequacy ratio was sufficiently "healthy," bank official Keiichi Riko said.
Bank of Tokyo-Mitsubishi applied for the funds under a $16.3 industry stabilization plan approved by the government in March 1998.
At that time, a drop in Tokyo stock prices and in the value of the yen threatened to leave many banks with insufficient levels of capital to do business overseas.
Helped by a rebound in the stock market and gains by the yen, Bank of Tokyo-Mitsubishi's group capital-adequacy ratio had risen to 11.1 percent as of September 1999 from 8.53 percent in March 1998.
The Bank for International Settlement requires a capital-adequacy ratio of at least 8 percent for internationally operating banks.