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Economy of Japan

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Sony has slashed its full-year profit forecast by 40 percent as it continues to struggle.

The Japanese electronics giant now expects to make a net profit of 30 billion yen ($305 million) in the financial year to March 31, 2014, down from its earlier projection of 50 billion yen.

The cut came as Sony said its loss in the July-to-September quarter widened 25 percent from a year ago to 19.3 billion yen.

One of the big drags on its earnings was its Pictures division which made a loss due to some high profile flops.

The division, which also includes production of movies as well as TV shows, recorded an operating loss of 17.8 billion yen during the period, compared to an operating profit of 7.9 billion a year earlier.

“The current quarter reflects the theatrical underperformance of White House Down, while the previous fiscal year included the strong theatrical performance of the Amazing Spider-Man,” Sony said in a statement.

Sony has slashed its full-year profit forecast by 40 percent as it continues to struggle

Sony has slashed its full-year profit forecast by 40 percent as it continues to struggle

There was also a decline in television licensing revenue due to fewer movies being licensed year-on-year.

Sony has also been hurt by increased competition and slowing global demand for TVs.

A decline in TV prices has further hurt the profitability of the sector.

Sony’s TV division posted an operating loss of 9.3 billion yen for the three months to the end of September.

At the same time, its gaming division which makes the PlayStation consoles also reported an operating loss during the period.

The firm said that the division’s earnings were hurt after it cut the price of its PlayStation Vita consoles.

Sony cut the prices of the original PS Vita earlier this year in a bid to boost sales, which have been affected by an increasing number of users playing games on their smartphones and tablet PCs.

Sony’s Game division made an operating loss of 800 million yen during the period, compared to an operating profit of 2.3 billion yen during the same quarter a last year.

Sony’s results are in contrast to rivals Sharp and Panasonic who reported profits for the July-to-September quarter.

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Japan’s Financial Services Agency (FSA) has decided to inspect three major banks, including giant Mitsubishi, over possible transactions involving yakuza organized crime gangs.

One of them, Mizuho Financial, has already admitted senior managers knew three years ago it had lent 200 million yen ($2 million) to Japanese criminal gangs, but did not take action.

An external inquiry cleared the bank of intentionally covering up the loans.

Mizuho Financial has already admitted senior managers knew three years ago it had lent $2 million to Japanese criminal gangs

Mizuho Financial has already admitted senior managers knew three years ago it had lent $2 million to Japanese criminal gangs

Sumitomo Mitsui is the third involved.

The yakuza gangs are not actually illegal. But like the Italian mafia or the Chinese triads, they are involved in unsavory activities such as gambling, drugs and prostitution, as well as operating protection rackets.

On Monday, lawyers hired by Mizuho to look into the transactions said “many officials and board members were aware of, or were in a position to be aware of, the issue”.

But the lawyers’ report also said that Mizuho failed to recognize it as a problem, believing that the compliance division “was taking care of it”.

The company said 54 former and current executives would be punished, including Mizuho bank chairman, Takashi Tsukamoto, who is resigning his position but will remain as head of the parent company.

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