To be sure, the situation in Japan is worrisome - not only because of that country’s economic importance but also because of its strong trade and financial links with other troubled Asian economies. But, and this is an important but, Japan has the capacity and the financial wherewithal to turn its situation around.
The evidence is similar to the studies done with US data, and sometimes the evidence is even stronger, since in Europe banks are the key source of finance for many firms. 16 For instance, Italian data show that bank M&As have an adverse effect on credit, especially if an M&A is followed by the termination of a business relationship.