JAPAN BANKS NEED TO ISSUE MORE USD BONDS

Japanese banks may have to be resourceful with their dollar funding, the chief of a Japanese banking group said on Thursday. The cost to convert local currency payments into dollars has risen in recent weeks amid speculation the Fed will raise interest rates in December. If the Fed rate hike is gradual, "We won't have too much trouble in raising dollars," Yasuhiro Sato, the chairman of Japanese Bankers Association said. But given that Japanese banks are beefing up overseas lending, dollar-funding could be a big challenge, Sato said. Increasing dollar denominated deposits and issuing dollar denominated corporate bonds will be necessary to raise funds in the currency, he added. (atsuko.fukase@wsj.com)