Page 82 - Invited Paper Session (IPS) - Volume 2

IPS184 Kimiaki S. et al.
banks, while the share is almost 0 percent for the rest of the banks as of end-
June 2018. These results suggest that almost all of the positions of the trust
banks are held on a trust-account basis, whereas the positions of the rest of
the banks are almost entirely on a banking-account basis (Chart 1). In what
follows, the figures reported by [Chart 1] Illustration of the figures of the

trust banks are used as estimates reporting banks
of the positions held on a trust- Banking accounts
account basis. Likewise, the figures Trust accounts
reported by the rest of the
reporting banks are treated as
estimates of the banking-account-
7
based positions in this paper.
Examining external claims and <All reporting banks> <Trust banks> <Rest of the banks >
liabilities in the LBS with a [Chart 2] External claims and liabilities of
breakdown of trustaccount- and Japanese banks (LBS)
banking-account-based figures 5
defined above (Chart 2), the 4 Trust accounts ↑ Claims
Banking accounts
trustaccount basis accounts for 3

more or less half of all external 2
claims. Meanwhile, thebanking- 1
account-based figures have large 0

shares in external liabilities. This can -1

be explained by the following -2 ↓ Liabilities
characteristics of the reporting 10 11 12 13 14 15 16 17 18
CY
banks’ activities over trust-account- Note: The figures are adjusted for exchange
rate fluctuations (to remove the
based positions. First, many of them impacts of foreign exchange rate
receive funds from domestic changes, outstanding amounts
investors such as pension funds and denominated in major currencies other
trust funds in Japanese yen, where than U.S. dollar <Japanese yen, euro,
British pound, and Swiss franc> are
such positions are not included in converted into U.S. dollar based on the
the LBS since they are liabilities vis- exchange rates as of end-2017). Latest
à-vis residents denominated in data as at end-June 2018.
Japanese yen. Second, such banks
invest those funds in foreign assets, which are to be reported in the LBS since
they are claims vis-à-vis non-residents. On a trust-account basis, the
outstanding amount of external liabilities is therefore considered to be
8
statistically small relative to those of external claims.

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