Japan Enacts Bill to Make Aid System for Local Banks Permanent

Tokyo, April 24 (Jiji Press)–Japan’s parliament Friday enacted a bill to effectively perpetuate a public fund injection system for regional financial institutions. In a plenary meeting, the House of Councillors, the upper chamber of the Diet, the country’s parliament, approved the bill to revise the law on strengthening financial functions. The application deadline for the public fund injection system was previously set at the end of March 2026. The system has become available “for the time being” under the revised law, however. The government will also keep in place permanently a special measure to ease injection conditions when possible large-scale disasters and pandemics occur. It will also revamp a subsidy system that regional banks and shinkin banks can use for mergers and management integration to support their management foundations amid the country’s declining population. The revamped system will newly cover the integration of core banking systems. The upper limit of subsidies for mergers will increase from 3 billion yen to 5 billion yen. For mergers and management integration across business categories, such as between regional banks and shinkin banks, or between shinkin banks and credit unions, the subsidy limit will rise to up to 7.5 billion yen. END [Copyright The Jiji Press, Ltd.]