TOKYO (Reuters) - The Nikkei average fell 1.3 percent on Monday and briefly touched a 26-year intraday low, pushed down as Mitsubishi UFJ Financial Group and other large banks fell and worries about the global economy weighed. Shares of Mitsubishi UFJ and other large banks were hammered on concerns they may need to raise billions of dollars each to offset hefty losses on their stock portfolios.
Finance ministers and central bankers from the Group of Seven said in a joint statement on Monday they were concerned about excessive volatility in the yen and the possible adverse implications for economic and financial stability.
But market players said the impact of this, as well as some economic steps likely to be taken by the Japanese government, appeared limited at this point.
"There was some short-covering of stocks on expectations of policy moves, but those announced at this point don't seem so effective and there's a bit of disappointment," said Takahiko Murai, a general manager of equities at Nozomi Securities.
"It's hard to know if some of the moves the government may be considering, such as the possible expansion of bank bailouts to around 10 trillion yen from 2 trillion yen, will really be enough."
The benchmark Nikkei was down 95.99 points to 7,553.09 in a day of volatile trade that saw it bounce wildly and fall as far as 7,486.44, its lowest since 1982 -- when Ronald Reagan was U.S. president and Sony Corp introduced CD players.
The broader Topix was down 3.4 percent to 778.71.
Banks dragged on the Nikkei, with Mitsubishi UFJ down more than 14 percent at one point after people familiar with the matter said the bank -- Japan's top lender -- is considering raising up to 1 trillion yen ($10.8 billion) to shore up its capital.
Mizuho Financial Group, Japan's second-largest bank, and third-ranked Sumitomo Mitsui Financial Group are both looking to raise as much as 500 billion yen ($5.4 billion), newspapers reported on Monday.
Mitsubishi UFJ was down 14.2 percent at 586 yen, while Mizuho lost 14 percent to 232,500 yen and Sumitomo Mitsui shed 11.5 percent to 385,000 yen.
(Reporting by Elaine Lies; Editing by Hugh Lawson)
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