Bank of Japan Review
Foreign Currency Liquidity Risk Management at Japanese Major Banks: Efforts and Enhancement

Securing stable foreign currency liquidity is one of the most important issues for Japanese major banks, as it is the basis of the expansion of their overseas businesses. The Financial Services Agency and the Bank of Japan have been conducting the "Joint Survey on Foreign Currency Liquidity Risk Management" for major banks classified as G-SIBs in fiscal 2021 until fiscal 2023. Moreover, the March 2023 banking turmoil in foreign countries shed new light on the importance of liquidity risk management.

Today, the Financial Services Agency and the Bank of Japan have jointly published Bank of Japan Review that focuses on Japanese major banks’ efforts to enhance their risk management through foreign currency liquidity stress testing based on more conservative and appropriate stress scenarios, early warning frameworks, and prompt and accurate liquidity data management.

The Financial Services Agency and the Bank of Japan expect and promote them to continue these efforts to further enhance their risk management in line with changes in the risk profiles of their overseas businesses and the external environment.

• Bank of Japan Review: Foreign Currency Liquidity Risk Management at Japanese Major Banks: Efforts and Enhancement
    （Bank of Japan, Financial Services Agency）- May 22, 2024

Contact

Major Banks Monitoring Office, Strategy Development and Management Bureau, Financial Services Agency

Tel: +81-(0)3-3506-6000 (ext: 2375)