Outage hits 128 Japanese credit unions as AI sell-off slams markets

A system failure at a Japanese banking network left customers at 128 credit unions without access to cash today, as the nation's stock market experienced steep declines.

According to local media, the Shinkin Joint Center outage prevented ATMs in the Tokai region from processing withdrawals, deposits and over-the-counter transactions.

Reports attribute the disruption to an "equipment malfunction" rather than a cyberattack.

Early forecasts suggested restoring services by the end of the day would be difficult, but several banks succeeded by 7pm Japanese Standard Time.

Outage struck as Japan's stock market slumped 7%

The disruption occurred as the Nikkei 225 index fell 7%, part of a broader AI stock selloff that erased $3.2 trillion from Wall Street.

South Korea's KOSPI index finished the session down 6%.

The tech downturn was reportedly sparked by fears that a Democrat-led US government could slow AI center development, and that Anthropic, owner of Claude, may no longer go public this month.

AI insiders had already cashed out $7.4 billion near peak prices between May and October, beating the slump.

UK banks also experienced an outage last month

A few weeks earlier, UK banks were disrupted by an outage at a Google Cloud data center in London.

That outage halted ATM services, identity verification, card payments, transfers, logins, chat support, and trading in stocks and crypto.

This incident was also not a cyberattack but a "power event."