As the business environment of regional financial institutions such as regional banks becomes more severe, the revised law of the Financial Function Enhancement Law to establish a new system to issue grants to regional financial institutions that are going to merge or integrate is announced on the 19th. It was passed and passed at the plenary session.
The pillar of this law is to establish a new system to support the reorganization as the business environment of regional financial institutions becomes more severe due to the declining population and the effects of the new coronavirus.
When a regional financial institution whose main business base is in a region with a declining population decides on a merger or business integration, it will issue a grant of up to about 3 billion yen to subsidize part of the necessary expenses such as system investment. I will.
The application period for the system is five years later, until the end of March 2026, and the deposit insurance corporation will use the retained earnings obtained from dividends from the financial institutions in which it invests.
The law is scheduled to come into force in July.
The Financial Services Agency wants to leverage the new system to strengthen the management base of regional financial institutions and support the local economy. In the future, the focus will be on whether or not the reorganization of regional financial institutions will proceed concretely. I will.
Local banks considering the use of the new system
Regarding the reorganization of regional financial institutions, it has been pointed out that the high cost of integrating each system is a high hurdle.
The Financial Services Agency wants to reduce this burden and improve the environment for the reorganization of regional financial institutions, and some regional banks are actually considering the use of the system.
Of these, "Fukui Bank" officially decided on the 14th of this month to make "Fukuho Bank", a regional bank in the same Fukui prefecture, a subsidiary.
The acquisition of a subsidiary is scheduled for October, and "Fukui Bank" has indicated that it wants to actively utilize the new system established by the Financial Services Agency.
In addition, "Aomori Bank" and "Michinoku Bank" in Aomori City, which have reached a basic agreement to aim for a merger in three years, are also considering the use of a new system for the integration of core systems, and similar movements will be made in the future. It may spread.
Banking Act Amendment Act passed and passed
On the other hand, at the House of Councilors plenary session on the 19th, a revised law of the Banking Act was passed and passed to review the regulations so that banks can earn profits outside their main business.
Specifically, on the premise of approval from the Financial Services Agency, we will make it possible to sell IT systems and apps developed for our company to the outside, as well as to conduct advertising business utilizing customer data owned by banks.
In addition, we will relax restrictions on investment in unlisted companies that are working to revitalize their businesses so that banks can start improving the management of small and medium-sized enterprises whose financial situation has deteriorated due to the spread of the new coronavirus infection.
Furthermore, in order to support the revitalization of the local economy, banks will be able to fully invest in unlisted companies that are trying to revitalize the region.
The revised Banking Act is scheduled to come into effect in November.