FSA Panel Calls for Drastic Reform of Bank Regulations

Politics Economy

Tokyo, Dec. 16 (Jiji Press)--A Financial Services Agency panel drafted a report Wednesday calling for drastic reform of banking regulations, including allowing banks to fully own small and midsize firms essential for regional economies and to enter the advertising sector.

The draft report, adopted at a Financial System Council working group meeting, also proposes to establish a subsidy program to facilitate regional banks’ realignment.

The government aims to introduce a series of amendments to relevant laws during an ordinary parliamentary session starting early next month with the aim of supporting the coronavirus crisis-hit regional economies’ recoveries and helping reinforce banks’ management bases, people familiar with the matter said.

Currently, banks are allowed to own up to 5 pct of nonfinancial companies and bank holding firms up to 15 pct, in principle.

The draft report suggests that the FSA approve banks’ full ownership of unlisted companies working to revitalize local economies, a move aimed at supporting regional efforts for business reconstruction and conversion.

[Copyright The Jiji Press, Ltd.]

Jiji Press