Lending Margins: Knowledge Structure and Risk Management

lending margins: Some of the lenders don't appear to, the regulators say, according to The Japan Times. The FSA has told them to strengthen their risk management, for example by adding staff if needed, said the officials who asked not to be identified due to the agency's policy. ; Regional banks have struggled in recent years as a shrinking population and narrowed lending margins hurt their loan business, while investment in government bonds loses its appeal with yields below zero. The Financial Services Agency FSA has been talking to bankers to gauge whether the firms have the knowledge and structure to handle those products, which cover everything from stocks to real estate, according to its officials. To boost returns, so-called first-tier regional lenders poured a record 1.94 trillion 18 billion into a category of securities that includes investment trusts and other funds in the year ended in March, according to Regional Banks Association of Japan data, bringing the total outstanding amount to 7.02 trillion. It would be a problem from a credit perspective if banks lacking sufficient capital or solid profitability keep adding those investment trusts, he said. To put it simply, they are taking on more risk, said Ryoji Yoshizawa, an analyst at S&P Global Ratings in Tokyo. (news.financializer.com). As reported in the news.