Ten lenders come to TEPCO’s aid in Japan

Tokyo Electric Power Company Holdings (TEPCO) is reportedly seeking a loan of 400 billion yen ($3 billion) from a consortium of banks to manage the rising cost of fuel and the weak yen, as reported by the Nikkei newspaper on Tuesday. The funding is expected to be obtained as soon as April.

Due to the escalating costs of fossil fuels such as liquefied natural gas and thermal coal, as well as domestic wholesale electricity prices, TEPCO has estimated a net loss of 317 billion yen by the end of March. It has also requested permission from the industry ministry to increase its power prices to households.

According to a recent report, a group of 10 financial institutions, including Sumitomo Mitsui Banking Corp, Mizuho Bank, Nippon Life Insurance Company, and Development Bank of Japan, are planning to provide funds to TEPCO. TEPCO also reported a loss of 484 billion yen in April-December 2022 for damages from the Fukushima disaster in 2011.

The report also stated that JERA, a joint venture between TEPCO and Chubu Electric, is planning to request up to 200 billion yen in subordinated loans to increase its capital.

TEPCO reportedly declined to comment, stating that it does not disclose details of its negotiations with financial institutions, as they are related to individual transactions.