What is Japan's Financial Services Agency (FSA)? Japan's Financial Services Agency (FSA) Review, Features

The Financial Services Agency (FSA) of Japan is responsible for regulating the banking, securities, insurance, trust and entire financial markets.

About Japan's Financial Services Agency (FSA)

• Financial Services Agency (FSA) of Japan;

• The Financial Services Agency of Japan was established in 2000 and is responsible for supervising the banking, securities, insurance, trust and the entire financial market. The Financial Services Agency consists of the General Affairs Planning Bureau, the Inspection Bureau, the Supervision Bureau and the Securities and Exchange Supervisory Commission. Its goal is to ensure the functioning of the financial market and protect the interests of investors and depositors.

• The Financial Services Agency of Japan is an all-round financial regulatory agency. It is responsible for regulating the banking, securities, insurance, trust industries and the entire financial market based on a series of laws and acts such as the Banking Act, the Trust Act, the Securities Act and the Insurance Act.

The role of the Financial Services Agency (FSA) of Japan

1. Planning the financial system;

2. Inspect and supervise market-related personnel such as banks, insurance companies, and financial commodity exchanges;

3. Set market trading rules for financial products;

4. Formulate corporate accounting standards and other debt-related matters;

5. Supervise certified public accountants and accounting firms;

6. To establish an international financial administration agency with international coordination functions and participate in bilateral financial agreements;

7. Monitor compliance with financial product market rules, etc.

Development History

• In June 1998, the Financial Supervisory Agency was formally established and is directly under the Prime Minister's Office, responsible for supervising most financial institutions. The Ministry of Finance is responsible for macroeconomic decision-making on financial systems, inspecting the financial systems of financial enterprises, supervising deposit insurance institutions, etc. The power to formulate financial policies still belongs to the Ministry of Finance.

• In December 1998, the Financial Revitalization Commission was established to rectify the financial order, restructure financial organizations, and rebuild the financial system. As a temporary agency, the Commission was responsible for implementing the Financial Revitalization Act, the Early Soundness Act, and the filing of cases related to the bankruptcy and crisis management of financial institutions, and was responsible for handling the bankruptcy cases of several large financial institutions such as the Long-Term Credit Bank of Japan. At the same time, the Financial Supervisory Office, which was established before, was merged into the Financial Revitalization Commission, but it continued to exercise its original inspection and supervision functions. The Ministry of Finance continued to be responsible for major decisions on the financial system and the inspection of corporate financial systems, while the supervision of deposit insurance institutions was changed from the previous independent supervision of the Ministry of Finance to coordinated supervision with the Financial Revitalization Commission. At this time, the power of the Ministry of Finance had been greatly weakened.

• In March 2000, Japan transferred the supervision power of small and medium-sized financial institutions from local governments to the central government and placed it under the Financial Supervisory Agency.

• In July 2000, the Financial Services Agency was established on the basis of the Financial Supervisory Agency, and the financial policy-making power (including financial system planning, proposals, and financial institution bankruptcy disposal and crisis management) and corporate financial system inspection functions that originally belonged to the Ministry of Finance were transferred to the newly established Financial Services Agency. The Ministry of Finance only retained the right to coordinate supervision of deposit insurance institutions with the Financial Services Agency, and participate in institutional decision-making on bankruptcy disposal and crisis management (but the focus is on ensuring the smooth implementation of decisions). The Financial Services Agency has both financial supervision power and financial policy-making power.

• In January 2001, the Financial Revitalization Commission was abolished during the comprehensive implementation of government agency reform, and its function of handling financial institutions on the verge of bankruptcy was also returned to the Financial Services Agency. At this point, Japan's financial regulatory power was once again highly centralized. The Financial Services Agency was upgraded to an external bureau of the Cabinet Office, independently responsible for financial regulatory business. At the same time, it assisted the Ministry of Finance (formerly the Ministry of Finance) in jointly supervising deposit insurance institutions. The Ministry of Finance only retained the function of coordinating supervision over deposit insurance institutions, and its subordinate local financial bureaus re-exercised financial regulatory powers over local financial institutions in the form of accepting the entrustment of the Financial Services Agency. By 2001, the basic framework of a new financial regulatory system with the Financial Services Agency as the core, the independent central bank and deposit insurance institutions participating together, and local financial bureaus and other entrusted supervision was formally formed.