November 29, 2017 / 7:40 AM / 8 months ago

BOJ's Nakaso: Bank consolidation may enhance Japan's financial stability

TOKYO (Reuters) - Bank of Japan Deputy Governor Hiroshi Nakaso said on Wednesday consolidation and reorganization of financial institutions could be effective in enhancing Japan’s financial stability.

Bank of Japan Deputy Governor Hiroshi Nakaso speaks during an interview with Reuters at the BOJ headquarters in Tokyo April 9, 2015. REUTERS/Yuya Shino/File Photo

“Regional financial institutions have sufficient capital and liquidity at present. Thus, there are no immediate threats to the stability of the financial system,” Nakaso said in a speech at a seminar in Tokyo.

But an indicator extracted from the stock market indicates the possibility that business conditions will become unstable “simultaneously” at many regional financial institutions facing chronic stresses from a dwindling population and a lack of fund demand, he said.

Reporting by Leika Kihara and Stanley White; Editing by Minami Funakoshi

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