The foreign chief executive of embattled Tokyo Star Bank is likely to be asked to step down, people familiar with the discussions said on Monday, Dow Jones Daily Bankruptcy Review reported. Robert M. Berardy, a rare foreign CEO at the helm of Japanese bank, will likely be asked to leave after creditors gain control of the bank from its current owner--private equity fund Advantage Partners LLC--according to the people. Masaru Irie, one of directors of the bank and its chief administrative officer, will likely be promoted to the bank's president, the people said.

Slow decision-making by the government is weighing on the credit ratings of Tokyo Electric Power Co., analysts at Moody's Investors Service said Thursday, adding that any forced debt waiver by the embattled utility's creditors could result in it being downgraded to junk status, Dow Jones Daily Bankruptcy Review reported. Discord within the Democratic Party of Japan-led government over how to share the burden of compensation related to the crisis at the Fukushima Daiichi nuclear plant has increased uncertainty over Tepco's ability to pay off its debt, the analysts said at a briefing.

Japan’s economy shrank more than estimated in the first quarter after the March 11 earthquake and tsunami disrupted production and prompted consumers to cut back spending, sending the nation to its third recession in a decade. Gross domestic product contracted an annualized 3.7 percent in the three months through March, following a revised 3 percent drop in the previous quarter, the Cabinet Office said today in Tokyo. The median forecast of 23 economists surveyed by Bloomberg News was for a 1.9 percent drop. Economists typically define a recession as two consecutive quarters of contraction.

The president of Mitsubishi UFJ Financial Group Inc. hit out at remarks by the government's top spokesman calling for lenders to forgive some of Tokyo Electric Power Co.'s debt, saying the government has no place directly intervening in private-sector business decisions, The Wall Street Journal reported. The comments Monday by Katsunori Nagayasu, president and chief executive of MUFG, Japan's biggest bank by assets, were the strongest yet by the head of a big lender in response to remarks Friday by Chief Cabinet Secretary Yukio Edano.

Japan's government on Friday unveiled a comprehensive plan to rescue Tokyo Electric Power Co. and fund compensation claims stemming from the country's worst-ever nuclear energy disaster that are expected to total more than ¥2.5 trillion, or roughly $31 billion, The Wall Street Journal reported. The approval by the cabinet of Prime Minister Naoto Kan came after last-minute disputes within the ruling party over how heavily the company should be penalized and who in the end would pay the massive costs.

Tokyo Electric Power Co. will accept government involvement in its management and won't cap total compensation funds for those hurt by Japan's nuclear crisis, as part of an agreement for assistance in meeting what could total tens of billions of dollars in claims, The Wall Street Journal reported. Tepco said that company President Masataka Shimizu notified the government of its acceptance of the conditions Wednesday in a letter to industry minister Banri Kaieda.

Cabinet ministers have agreed to demand that Tokyo Electric Power Co. carry out deeper restructuring so it can secure enough compensation for damage caused by the Fukushima No. 1 power plant but were less certain on whether a new entity should be set up to help it, officials said, The Japan Times reported. The decision to set up the entity, which would provide funds to help the beleaguered utility known as Tepco pay for radiation-related damages, was delayed on Saturday.

The court-appointed administrator of failed consumer lender Takefuji Corp. said Friday he won't disclose details of the bidding process to particular bondholders due to confidentiality agreements, Dow Jones Daily Bankruptcy Review reported. Eiichi Obata, the lawyer charged with Takefuji's sale, said at a press conference he hopes bondholders would understand that the bidding process had proceeded under the guidance of the court and third party inspectors. He added that he would talk with creditors seeking their understanding.

Japanese industrial production and consumer spending dropped at their sharpest rates on record in March, the government said Thursday, underscoring the impact of the recent earthquake and tsunami and the continuing nuclear plant crisis on the nation's fragile economy, The Wall Street Journal reported. The latest data show how sharply the Japanese economy veered from its recovery track after the March 11 disaster disrupted the nation's supply chains, impaired nuclear power generation and darkened the mood among consumers.

The threat of a cut to Japan’s credit rating adds pressure on Prime Minister Naoto Kan to raise taxes as he wrestles with financing earthquake rebuilding without adding to the world’s biggest public debt burden, Bloomberg reported. Standard & Poor’s lowered its outlook yesterday to “negative” on Japan’s AA- local-currency rating, estimating that costs stemming from the earthquake, tsunami and nuclear crisis may boost budget deficits by 3.7 percent of gross domestic product through 2013.