The head of the Japanese Bankers Association said Tuesday that the domestic real economy is worsening more than expected.

"With the sharp decline in exports as the starting point, the entire domestic economy is under downward pressure," Seiji Sugiyama said at a regular press conference.

He added the business environment will likely remain harsh for Japanese banks for at least the rest of this year.

-By Juro Osawa, Dow Jones Newswires; 813-5255-2957; juro.osawa@dowjones.com

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