Japanese financial institutions lost as much as $2.1 billion from investments related to risky U.S. housing loans in the half of fiscal 2007, according to a government estimate published by Japanese newspapers Friday.The 230 billion-yen losses accounted for about 17 percent of a combined 1.3 trillion yen ($11.9 billion) in securitized holdings that included the so-called subprime loans, according to the Nikkei, one of the newspapers reporting the Financial Services Agency estimate. The FSA said in its Thursday report that the U.S. subprime problems have so far had a limited impact on Japanese financial institutions. But the losses could expand because of the resulting market turmoil, which has been ongoing since last month, the Nikkei said.



Agency officials were not available for comment Friday, a national holiday.

The damage estimate from the problems in the U.S. mortgage market is the first by a Japanese financial authority. It is based on a FSA survey of 576 Japanese financial institutions, including the nation's top 10 major banking groups, the Yomiuri newspaper said.

Most of the damage came from the major Japanese banks, according to the report.

Japan's leading six banking groups are expected to face at least 300 billion yen ($2.75 billion) in combined losses on their investments involving assets based on risky loans in the U.S. housing market, the Nikkei said.