While this underlines the severe predicament of the financial system, it also illustrates the result of the efforts, by major banks in particular, to reduce their NPLs and strengthen their provisioning. Second, it has become commonly recognized that corporate revitalization is an integral part of dealing with the NPL problem.
For example, the Industrial Revitalization Corporation of Japan (IRCJ), which began operations in May this year, has decided to work on six companies to date through the purchase of their debt from non-main banks.