Moves by regulators in big economies to raise capital adequacy requirements on all banks could force financial institutions to restrict lending at a time when they should actually be increasing it, the head of Japan’s largest banking group has warned.

Nobuo Kuroyanagi, president and chief executive of Mitsubishi UFJ Financial Group (MUFG), told the Financial Times that if regulations were imposed “excessively” banks “will move to shrink their assets”.