Which Japanese brokerage firm collapsed in 1997, helping intensify Japan’s financial crisis?

Yamaichi Securities collapsed in 1997, helping intensify Japan’s financial crisis.

Yamaichi Securities was one of Japan’s largest securities firms. On November 24, 1997, it announced that it would close after accumulated losses and off-balance-sheet liabilities became impossible to manage. The failure followed the bursting of Japan’s asset-price bubble and years of falling stock and land values.

Its collapse came during a particularly severe period for Japanese finance. Hokkaido Takushoku Bank failed days earlier, and major financial institutions faced rising bad loans. Yamaichi’s failure undermined confidence in Japan’s longstanding system of close relationships between banks, companies, and government institutions.

Yamaichi is sometimes confused with Nomura, Daiwa, or Nikko, which were major Japanese securities firms that survived the episode. The collapse was also separate from the 1997 Asian financial crisis, although both crises occurred during the same year and affected international investor confidence.