TOKYO: Tokyo stocks closed lower on Monday as contagion fears grew after the failure of US regional lender Silicon Valley Bank (SVB) sent Wall Street shares tumbling.

The benchmark Nikkei 225 index ended down 1.11 percent, or 311.01 points, at 27,832.96, while the broader Topix index lost 1.51 percent, or 30.59 points, to 2,000.99.

“SVB’s failure led to global risk-off sentiment as worries over the financial system grew,” IwaiCosmo Securities said.

“The prospect that the Bank of Japan’s massive easing policy will likely be maintained for a while also prompted sales of banking shares, while the yen’s appreciation against the dollar weighed on export-linked shares.”

US authorities unveiled sweeping measures on Sunday to rescue depositors’ money in full from SVB.

The Federal Reserve also said it would make extra funding available to help other institutions meet customer needs, as a second tech-friendly bank was closed by regulators.

With the two bank failures rattling nerves, US President Joe Biden vowed to hold “fully accountable” the people responsible for “this mess”.

Biden said he would deliver remarks on Monday about maintaining a resilient banking system.

Tokyo shares close higher for fifth day

In Asia, the dollar fetched 134.35 yen, down from 134.80 in New York late Friday.

SoftBank Group fell 1.67 percent to 5,254 yen and Toyota lost 1.69 percent to 1,864 yen. Hitachi dropped 2.30 percent to 6,888 yen.

Megabanks ended sharply lower, with Mitsubishi UFJ Financial Group falling 3.47 percent to 900 yen, and Sumitomo Mitsui Financial Group sinking 4.16 percent to 5,669 yen.