Japan's Nikkei share average dropped on Wednesday, pressured by overnight Wall Street declines as worries resurfaced about the health of the banking sector, as well as a possible U.S. recession.

Investors were also cautious ahead of the domestic earnings season getting into full swing from Thursday and new Bank of Japan (BOJ) governor Kazuo Ueda's first policy decision on Friday.

The Nikkei, which had hit an eight-month high on Tuesday, retreated 0.53% to end the morning session at 28,469.08.

The broader Topix slumped 0.7% to 2,027.86.

Robot maker Fanuc, chip-testing equipment maker Advantest and financial giant Nomura Holdings are among the three dozen or so companies reporting results on Wednesday, with that number increasing to more than 100 on Thursday and more than 200 on Friday.

The market consensus is that the BOJ will keep policy unchanged this week, but investors are still wary of surprises, like the unexpected doubling of the 10-year bond yield policy band in December.

"I think the risks are tilted towards the upside" for Japanese stocks, Daiwa Securities equity strategist Kenji Abe said, who predicts no action by the BOJ on Friday.

"I expect some companies to announce share buybacks this week and in May, and that is likely to push up equities," with the Nikkei challenging 29,000 in the near term, he said.

Banks led losses among the Tokyo Stock Exchange's 33 industry sectors, slumping 1.91% after First Republic Bank reported plunging deposits.

Regional lender Chiba Bank was the worst performing financial stock on the Nikkei, dropping 2.38%, followed by a 2.33% decline for Concordia Financial and Mizuho falling 2.31%.

Mitsubishi Motors <7211.T) was the biggest decliner, dropping 2.57%. The automaker said after the close on Tuesday it would take a one-time charge of about $78 million related to slowing sales at its China unit. (Editing by Rashmi Aich)