Japan's recovery is proceeding at a snail's pace

The check is the third in three years, as the government tries to sort out the multi-trillion yen bad debt problem.

The concern is that some big borrowers may be in worse financial health than the banks have admitted.

Earlier this week shares in several banks were hit hard by rumours of an upcoming investigation.

UFJ, the smallest of Japan's Big Four banks, saw its shares slide 12% on 26 January after rumours that it was to be singled out.

Heizo Takenaka, the technocrat Economics and Financial Services Minister in charge of the clean-up, said a special team would examine the books of borrowers as well as the banks' own records.

"We have been aiming to resolve the problem of banks' balance sheets and bad loans this fiscal year," he said.

"Ideally, we wouldn't have to conduct these inspections, but for that, we need to make more of an effort and so do the banks."

Slowdown

The last time the Financial Services Agency (FSA) investigated bad debts, it downgraded the status of 27 out of 167 borrowers at 11 major banks, forcing them to push up their acknowledged losses on bad debts by 1.3 trillion yen.

Official estimates for the total debt burden top out at 50 trillion yen ($470bn; �260bn), but some private sector economists believe it could be four times higher.

The huge sums are the result of scattergun lending during the 1980s boom years, when banks often lent to companies with which they were allied without proper security.