For the first time, common legislation and rules will be applied by a single authority, strongly increasing transparency and banks’ comparability across countries. But we must recognise that we have not reached the end of the journey. A single supervisor can more easily ensure comparability where there are single rules.
That said, given the significant economic downturn, Japan’s economy is likely to remain in a severe situation for the time being. Thereafter, as the impact of COVID-19 wanes globally in the second half of the year, Japan’s economy is likely to improve, mainly on the back of pent-up demand and the effects of macroeconomic measures.