WRAPUP 1-MUFG, Mizuho slash profit forecasts on market turmoil

viernes 31 de octubre de 2008 15:53 CET

(Corrects paragraph 9 to show bad loan costs for six months, not nine)

* Top Japanese banks cut outlooks on bad loans, stock losses

* MUFG cuts full-year profit forecast 66 pct, Mizuho 55 pct

* Central bank says Japan economy in severe condition

By David Dolan

TOKYO, Oct 31 (Reuters) - Japan's two-largest banks, Mitsubishi UFJ Financial Group (8306.T: Cotización) and Mizuho Financial Group (8411.T: Cotización), cut their earnings outlooks by more than half on on Friday, hit by growing bad-loan costs and a plunging local stock market.

Once thought to be relatively insulated from the global credit crisis, Japanese lenders are now facing a sharp downturn in profits, hurt by a brittle domestic economy and overexposure to a stock market that has lost near half its value this year.

Resona Holdings (8308.T: Cotización), Japan's fourth-largest bank, also cut its outlook on Friday, citing ballooning bad loan costs.   Continuación...