The exchange rate of 1970 yen is 1 US dollar to 360 yen, and 1988 yen to 135.5 yen, with an appreciation of nearly three times. The purchasing power of Japanese banks and enterprises to invest abroad has greatly improved. Based on the exchange rate analysis, under the background of the substantial increase of foreign exchange reserves, the appreciation of the yen and the excess funds of banks, the increase of foreign investment income is greater than the appreciation of the yen, and Japanese banks actively seek external expansion. Based on interest rate analysis, assuming that the capital cost of Japanese yen is roughly equal to the interest rate of Euro, and enterprises can obtain funds in two currencies at will, the monetary advantage of Japanese banks is very small or even non-existent.
In the1980s, neither of the above conditions was available, and the advantage of the yen was obvious. At the same time, the appreciation of the yen, especially after 1985, led to a substantial increase in the book value of Japanese banks' capital and an improvement in their international ratings, which enabled them to obtain cheap funds and rapidly expand their overseas assets. This is an indirect effect. After 1990, with the liberalization of interest rates, the above two conditions were gradually established and played a role, and the advantages of Japanese banks in the yen declined, but the indirect effect of yen appreciation could not be ignored.
/kloc-during the period of 0/980s, under the background of financial liberalization, Japanese banks gradually relaxed their control, such as relaxing the restrictions on banks' participation in foreign exchange transactions and overseas institutions providing European yen loans to domestic customers, and their international business increased. However, the maintenance of regulatory policies such as interest rate control and separate operation forces some banks to set up institutions in overseas markets, especially offshore markets, to carry out domestic restrictive business in order to avoid supervision. The implementation of interest rate control, the domestic interest rate is lower than the European and American market interest rates, which provides favorable conditions for Japanese banks to raise funds at home, lend in the United States, allocate resources globally and develop internationally. The protection and support of the Japanese government eliminated the worries of the internationalization of Japanese banks. Stimulate it to implement the scale expansion strategy. According to statistics, in 1984, the overseas assets of Japanese banks were 3.41/billion dollars, and in 1993, they reached 2 18 1 billion dollars.
As international financial centers, new york, London, Switzerland, Luxemburg and Hongkong have their own characteristics, which are very attractive to foreign banks. Japanese banks set up institutions in these areas to conduct bond trading and other businesses, forming a global 24-hour continuous trading system. 1980s, the P/E ratio of European and American banks was generally low, while the P/E ratio of Japanese banks was high, the purchasing power of Japanese yen was strong, and the cost of overseas acquisition was low.
In terms of foreign investment policy, the European market is strictly controlled, and Japanese banks buy less in the European market, mainly based on newly established institutions; The American market is relatively loose. In order to improve the capital adequacy ratio, American banks sold a lot of loans to foreign banks, which enabled Japanese banks to take over many American banks at reasonable prices. The American market is huge. At that time, the banking law of the United States prohibited cross-state operations and prohibited banks from operating in mixed operations with securities and insurance. Banks are generally small in scale and distributed in different cities, so they can't provide comprehensive financial services for customers, which also provides favorable conditions for Japanese banks to enter and carry out related businesses.