Mizuho will boost overseas lending by 50%

Aims at Latin America and emerging Asia.

Mizuho Financial Group Inc, one of Japan’s four megabanks, expects to increase its overseas syndicated loans by half this fiscal year. Japan’s third-biggest lender by market value could arrange US$4.45 billion of such loans in the 12 months to March 2014.

Mizuho is steering cash flush Japanese regional banks into Latin America and emerging Asia to bolster interest income in the face of low yields at home.

The excess cash in regional banks jumped to a record US$925 billion last month. The Bank of Japan said deposits at domestic local lenders continued to climb in June, extending increases into the 11th year and outpacing lending growth.

Deposits at regional banks jumped 3.7% last month to US$2.95 trillion, exceeding a 2.8% increase in lending to US$2.0 trillion, according to the BOJ. The average interest rate on new long-term loans was 1.002% in May versus the all-time low of 0.969% in March.