Japan's financial watchdog inspects Suruga Bank: Nikkei

TOKYO (Reuters) - Japan's financial watchdog has launched an on-site inspection of Suruga Bank Ltd <8358.T> in connection with loans it made to customers for housing investment, the Nikkei newspaper reported on Friday.

The Financial Services Agency (FSA) last month ordered the bank to report on loans it made to retail customers who built so called share houses, where tenants share bathrooms and other facilities.

The regulator is checking whether senior officials were involved in falsifying documents used for examining customers' ability to repay the loans, the Nikkei said.

The bank was not immediately reachable for comment on the FSA inspection.

Suruga Bank, based in Shizuoka prefecture in central Japan, told Reuters last month that it made the loans to customers who invested in these facilities.

These are operated by a property firm Smart Days Inc, which this week filed for bankruptcy protection.

Suruga Bank shares have fallen 36 percent since mid-January.

(Reporting by Junko Fujita; Editting by William Mallard and Gopakumar Warrier)

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