UK banks have around £136bn of exposure to Japan, according to figures from the Bank of England.
Last Friday’s earthquake and tsunami wiped out many towns on the east coast and badly damaged a nuclear plant in Fukushima. Japan is still working to try to avert a full-scale nuclear disaster.
According to the Press Association, the £136bn bank exposure estimate includes loans to Japanese firms in Britain and holdings in Japanese government debt.
The FSA says it is “too soon” to estimate the scale of losses for insurers from the disaster.
FSA prudential risk team member David Rule told the Press Association: “The risk we think is manageable on the banking side. On the insurance side it is early days.”
Some estimates put the potential claims bill from the earthquake alone at as much as £22bn.