In another attempt to ease the growing credit crunch, Koichi Kato, secretary general of the ruling Liberal Democratic Party, has urged Japan’s regional banks to close their international operations and focus on supplying more funds to local companies.

“Many regional banks are trying to attain (the 8-percent capital-to-asset ratio benchmark set by the Bank of International Settlements) to stay in the international financial business. But under current (financial situations), they should rather give up on international business and put priority on channeling necessary funds for companies in their respective regions,” Kato told reporters on Tuesday at the LDP’s Tokyo headquarters.

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