Tough review pumps up Mitsubishi Trust debt.

Outstanding bad loans of top lender Mitsubishi Trust & Banking will top 1 trillion yen after its decision to adopt much stricter loan assessment methods than its rival banks next month.

Officials of Mitsubishi Trust said Saturday that its bad debts are expected to amount to over 1 trillion yen as of its September settlement of accounts. Under the less strict assessment methods used for the March settlement of accounts, the figure would shrink to about 930 billion yen.

The total amount of bad loans has ballooned after Mitsubishi Trust downgraded many of its loans categorized as "need to be watched," to "need to be supervised." Any debt that failed to achieve …