Japan Regulator Urges Regional Banks to Brace for Deposit Fight

The new chief of Japan’s financial regulator has a message for regional banks: don’t rely on rising interest rates to fix your problems.

Local lenders have been counting on last year’s scrapping of negative rates to help turn them around, blaming the policy for crushing profitability. But the new era of higher rates will spark fresh competition for depositors at a time when technology is transforming the industry, according to Financial Services Agency Commissioner Yutaka Ito.