TOKYO, April 28 Japan's banking regulator is pushing regional banks to set up joint operations to help small and medium-sized Japanese firms expand abroad by offering foreign currency-based transactions and overseas loans, sources with direct knowledge of the matter said.
"Our idea is for regional banks to play a fuller role in promoting clients' overseas expansion by setting up banks or joint ventures to handle foreign currency-based settlements and loans," Financial Services Agency Commissioner Ryutaro Hatanaka told a meeting of regional bank heads this month, according to the sources, who were not authorised to discuss the matter publicly.
Small Japanese businesses, which rely on regional banks for financial services, are increasingly doing business abroad, but domestic-focused regional institutions typically lack the size and expertise to offer services overseas on their own.
Hatanaka said it was not practical for Japan's top banks, which have already been aggressively building up overseas operations, to provide financial services to small businesses.
FSA officials declined to comment, saying the meetings with regional banks were not open to the public.
Many small and medium-sized Japanese businesses are setting up shop in emerging markets in Asia to tap growing markets or supply big Japanese firms that operate abroad. (Reporting by Sumio Ito and Taiga Uranaka; Additional Reporting by Noriyuki Hirata; Editing by Edmund Klamann)