Japan's Sharp Corp said it had secured a $1.9 billion bailout, its second major bank-led rescue in three years, after falling deep into the red as its smartphone display business was battered by competition from Asian rivals.

But while new restructuring measures will include 5,000 job cuts or 10 percent of its global workforce as well as the sale of its headquarters, the steps were seen as not going far enough.

Chief Executive Kozo Takahashi said he was not considering spinning off the company's troubled display business and would continue making TVs in Japan, leaving investors doubting the company's long-term viability.

"The current business model is not convincing," said Mitsushige Akino, chief fund manager at Ichiyoshi Asset Management. "It has cutting-edge display technology but it's not profitable."

Under the deal, main lenders Mizuho Bank and Bank of Tokyo-Mitsubishi UFJ will inject a combined 200 billion yen ($1.7 billion) in a debt-for-equity swap.

Japan Industrial Solutions, a corporate turnaround fund owned by a consortium that includes the two banks, will also provide 25 billion yen in return for preferred shares.

But while its lenders signed off on the bailout, they did not view Sharp's restructuring measures as complete. A senior official at one of Sharp's main banks said the announcement lacked a solid turnaround plan for the display business.

"Consideration of more measures including possible mergers are necessary. That's going to take time," the banker said, declining to be identified due to the sensitivity of the matter.

MISTAKES WERE MADE

Sharp, once Apple Inc's most favored supplier, posted an annual net loss of 222 billion yen, its third loss in four years, with Takahashi blaming a rapid deterioration in its operating environment in the second half.

He acknowledged management was also to blame for the loss but said he had no plans to step down, at least for the duration of the three-year restructuring plan unveiled on Thursday.

"Of course, if we hadn't make mistakes we wouldn't be in this situation," he told a news conference. "I was central to making this medium-term plan, so I can't possibly quit in the middle of it."

He said the company would aim for a return to operating profit, setting a goal of 80 billion yen for the current year and 120 billion yen two years later.

Osaka-based Sharp, which gains much of its revenue from LCD screens and TVs, has tried to focus on high-end displays to protect its margins and avoid directly competing with smaller Asian rivals.

But it has struggled to innovate sufficiently to keep commanding significant premiums from the likes of Apple. In addition to Chinese competitors, it has also faced unexpectedly strong competition from domestic rival Japan Display Inc and has been hit by a weaker yen.

In return for the funding, which will be used to repay debt and finance investments, Sharp will also sell its headquarters and said it might seek a partner for its TV business in North America.

That would follow the licensing of its TV brand in Europe to Universal Media Corp, effectively focusing the company's resources on Japan and the rest of Asia.

Sharp also said it would reduce its capital to 500 million yen from over 120 billion yen to wipe out cumulative losses on its books - a move that paves the way for resumption of dividends and was seen as key to getting the banks to agree to a deal.

The shares closed on Thursday at 200 yen, down 1 percent on the day and down 25 percent for the year to date. Its market capitalization has shrunk to 355 billion yen from a peak of 3 trillion yen in late 1999.

The rescue is the second since September 2012 when banks provided Sharp with loans and credit lines worth 360 billion yen, or $3 billion at today's exchange rates.