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On May 25, 2026, Japan's Financial Services Agency (FSA) published additional questions and answers addressing capital ratio regulations. The FSA expanded its existing Capital Ratio Regulation Q&A guidance to include two new areas of clarification for financial institutions. The additions address the credit risk reduction effects associated with corporate value pledges and the treatment of exposures covered by insurance underwritten by Japan Export-Import Bank (JBIC). These clarifications provide financial institutions with regulatory guidance on how to account for these specific risk mitigation techniques when calculating their capital ratios under Japanese prudential standards. The updated Q&A guidance represents the FSA's ongoing effort to provide clarity on the application of capital ratio regulations to financial institutions operating in Japan. By addressing specific scenarios and risk mitigation approaches, the FSA aims to ensure consistent interpretation and implementation of capital adequacy requirements across the financial sector. The additions reflect evolving market practices and the need for regulatory guidance on emerging collateral and insurance arrangements used by financial institutions. Financial institutions subject to capital ratio regulations should review the updated guidance to ensure their capital calculations and risk management frameworks align with the FSA's clarifications. The full text of the amended Q&A, including only the newly updated sections, is available on the FSA website. For further information, financial institutions may contact the FSA's Comprehensive Policy Bureau, Risk Analysis and Oversight Division, Soundness Standards Office.