japan-net-banks-mortgage-boj-normalization-deposit-war
- Japan's online banks rode ultra-low mortgage rates; BOJ normalization now threatens that engine
- Thin deposit bases leave net banks exposed as funding costs climb
- Losing the deposit war would pressure liquidity and erode mortgage pricing edge
- Borrowers eyeing Japanese property should price in rising rates, not just teaser rates
- Rate reversal is reshuffling the balance between megabanks and online challengers
Anyone holding or shopping for a Japanese mortgage should watch this. The model that powered a decade of online-bank expansion is stalling as the Bank of Japan normalizes policy. Branchless lenders like Rakuten, SBI Sumishin and au Jibun grabbed share by undercutting the megabanks, but their funding rests on rate-sensitive retail deposits with little stickiness. As market rates rise, mortgage spreads compress while deposit competition heats up, squeezing both ends. Toyo Keizai's warning is blunt: lose the deposit war and liquidity strain follows, dragging down the pricing edge. For overseas buyers, the lesson is that variable teaser rates may not last. Japan's normalization will test every business model built on permanently free money, and net-bank mortgages are first in line.