The English version of "FSA Analytical Notes (2025.6) vol.2" published by the Financial Services Agency on June 17, 2025, contains two analyses: an analysis of regional banks' credit risk management practices and a study on the actual usage of credit guarantee systems.
Key Points
Analysis of Regional Banks' Credit Risk Management Practices
- Conducted verification of credit risk mitigation (loan coverage) and rating transition prediction models using loan data collected through the common data platform
- Found that collateral coverage ratios tend to be lower for shared borrowers who have loans from multiple banks
- Confirmed similarly lower coverage ratios for prefecture-wise cross-border loans
- Suggested that models predicting downgrades from "borrowers requiring caution or better" to "borrowers requiring management or worse" can function with relatively high accuracy even when using only financial information
Fact-finding on Credit Guarantee System Usage
- Analyzed determinants of credit guarantee usage using machine learning approaches with loan data from the common data platform
- Sales revenue and equity ratio have relatively large impacts on credit guarantee usage, with borrowers having higher values for these indicators tending not to use credit guarantees
- Found significant differences in credit guarantee usage trends depending on whether there is excess debt
- Confirmed differences in credit guarantee usage trends across industries
- This analysis aims to understand usage patterns rather than evaluate the appropriateness of credit guarantee usage
Initiatives for Advanced Data Utilization
- Strengthening data utilization in financial supervision and policy formulation is positioned as a medium- to long-term challenge
- The FSA will continue to promote the development of data analysis capabilities and data infrastructure
- Aims to accurately grasp the resilience and vulnerabilities of the entire financial system through analysis using granular data
The article demonstrates that the FSA is promoting data-driven financial administration and strengthening efforts to more precisely understand the management conditions of individual financial institutions and risks in the entire financial system.