During recent discussions, Bank of Japan (BOJ) officials emphasized the resilience of Japanese banks, stating they possess sufficient capital and stable funding to weather various stress events. The BOJ's semi-annual financial system report highlighted an increase in firms' demand for loans despite rising lending rates. Furthermore, the BOJ urged banks to remain vigilant against market risks and geopolitical threats. In related diplomatic talks, Japan's finance chiefs, including Kato and Mimura, engaged with U.S. Treasury Secretary Janet Yellen, agreeing to maintain close communication regarding foreign exchange matters. This comes amidst a broader context of market jitters and the need for appropriate measures to ensure the stability of Japan's financial system.