5:00 AM New York, 7:00 PM Tokyo - Japan’s current account surplus falls 18.9% to 13.2 trillion yen in 2009. A separate report showed that bank lending in January decreased 1.7% to 401 trillion yen. Kirin and Suntory terminated their merger talks. Sumitomo Mitsui Financial Group Inc did not revise its full-year earnings outlook.

Japan market averages fell as the euro weakened the most in a year to 120.71 yen and current account surplus shrank for the second year in a row.

In Tokyo trading Nikkei 225 Stock Average fell 1.1% or 105.27 to 9,951.82, and the broader Topix Index decreased 1% to 883.07.

In the first section of the Tokyo Stock Exchange 9.4 billion shares worth 576 billion yen were traded and in the second section 222 million shares valued at 1.4 billion yen changed hands.

Of the Nikkei 225 index stocks, 44 gained, 168 dropped, and 13 were unchanged. IHI Corp. led gainers in the index shares with a rise of 5.8% followed by Toyo Seikan climbing 4.4%.

The cost of eight models recalls for Toyota is likely to be higher than $2 billion estimated by the company. The automaker is facing 34 class-action lawsuits and 12 individual lawsuits for death and injuries related to sudden acceleration problem.

Current Account Surplus Falls 18.9%

Japan’s ministry of finance reported today that the country’s current account surplus fell 18.9% from a year ago to 13.2 trillion yen, the second straight year of contraction.

However, the trade in goods and services for the twelve months through December ended with a surplus of 2.12 trillion yen.

The finance ministry also reported that in December the current account surplus surged 452.8% to 900.8 billion yen on rising exports, while the balance of trade in goods and services was a surplus of 505 billion yen.

Bank Lending Falls 1.7% in Jan

Bank of Japan reported today that the average daily lending balance at domestic banks dropped 1.7% to 401.57 trillion yen in January, dropping for the second straight month.

Average daily lending balance at city banks like major banks and trust banks decreased 3.4% to 108 trillion yen.

In addition, average lending balance at regional and second-tier regional banks increased 0.3% to 194 trillion yen, while total lending balance at banks and shinkin banks dropped 1.5% to 465.03 trillion yen.

Kirin, Suntory Terminate Merger Talks

Kirin Holdings Co. and Suntory today terminated their merger talks after the companies were unable to agree on the merger details.

President Kazuyasu Kato of Kirin met with President Nobutada Saji of Suntory earlier today attempted one more time to bridge the differences.

Kirin Holdings said continuing the merger talks will not benefit its stakeholders.

Nikkei Movers

Daichi Sankyo Co Ltd led the decliners in the Nikkei 225 Stock Average with a loss of 8.6% followed by losses in Kirin Holdings Company, Limited of 7.3%, in Asahi Breweries Ltd of 5.5%, in Panasonic Corporation 5.3% and in Casio Computer Co Ltd 5.3 %.

IHI Corporation led gainers in the Nikkei 225 Stock Average with a rise of 5.8% followed by gains in Toyo Seikan Kaisha Ltd 4.4%, in Mitsubishi Materials Corporation of 3.4% and in Nippon Meat Packers Inc of 3.1%.