The Financial Services Agency plans to relax the rule limiting bank stakes in non-financial companies to 5%, The Nikkei reported. By lifting the cap on ownership to 10-20%, the FSA hopes to nudge banks, particularly regional financial institutions, into helping struggling companies get back on their feet. If regional banks become able to provide more capital in addition to loans, it would stabilize smaller businesses' cash flows and could spark fresh capital investment. There have been calls within the ruling Democratic Party of Japan to relax the rule to encourage the growth of local economies.
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