As the collapse of the money market bubble became decisive from 1993 to '94, both the government and business circles came to entertain widespread apprehensions that many a financial institution would break down and, if the worst comes to the worst, an extensive financial crisis would be imminent. The most important problem which attracted a great deal of attention and which the government had to take some measures for, in this case, was the liquidation of so-called
Jusen (the finance companies specializing in the housing loan). The
Jusen were originally the subsidiary companies founded by the groups of city banks and some local ones, and their main business was the housing loan for individual customers. As the price of land, however, was rising remarkably during the bubble, they began to loan real-estate brokers with the affluent sum of money financed not only by the parent banks that directly took part in establishing them, but also by many other financial institutions. Seven
Jusen thus raised almost 14, 000, 000 million
yen of funds. The large part of the loan on real property became irrecoverable as the land price fell suddenly at the collapse of the bubble, and consequently the
Jusen were on the verge of bankrupcy, which meant the accumulation of an enormous sum of bad credit on the side of the financial institutions that loaned them.
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