Bankers at Sumitomo Mitsui were returning a 14-year-old favour to Tokyo Electric Power when they pulled together a consortium this week to offer Y2,000bn ($24.7bn) in emergency loans to the utility at the centre of Japan’s nuclear crisis.
When the bank faced liquidity problems during the Asian financial crisis in 1997, Tepco – a loyal customer that had a top-notch credit rating – raised about $2bn at low rates from western banks, according to people familiar with the matter. It promptly put the cash on deposit at Sumitomo Mitsui, helping the bank through the crisis.
Few companies might be expected to survive after playing such a central role in a disaster on the scale of this month’s nuclear accident at Tepco’s Fukushima Daiichi nuclear plant in north-eastern Japan. The accident has leaked radiation over hundreds of kilometres and contaminated the food chain and water supply and is expected to result in large compensation claims.