The Financial Services Agency has decided to make it easier for regional banks with solid financial standing to put money into their struggling peers, introducing a special measure under which their capital-to-asset ratios will not be reduced, according to officials.
The measure is likely to take effect by the end of the current fiscal year in March, the officials said Monday.
It is aimed at providing a survival option to troubled regional banks that are finding it hard to increase their earnings amid the Bank of Japan's prolonged low-interest policy but are reluctant to engage in mergers and acquisitions.