Press Conference by the Minister for Financial Services

(Excerpt)

September 27 , 2004

Q.

You stated at a recent press conference that three tasks were given by the Prime Minister. How do you plan to address each task?

A.

The Prime Minister has requested me to pay special attention to the three areas in the financial administration.

First, the Non-Performing Loans problem should be solved through steadily implementing the ''Program for Financial Revival'', and the financial system reforms should be achieved to implement the new deposit insurance system limiting the government protection of savings deposits, as scheduled.

Second, activating regional economies and revitalizing Small- and Medium-sized Enterprises (SMEs) are among the most important issues in the context of economic structural reform.

In order to achieve these tasks, facilitating smooth finance in the region and to the SMEs is extremely important and the Prime Minister asked me to make solid efforts toward it.

Third, he requested me to implement such financial administration that the world's highest level of financial function would be supplied to users meeting their needs.

On the basis of these indications, the FSA must build a more user-oriented financial function to respond their needs, and further stabilize and strengthen the system so that the Japanese financial system strongly supports the economic structural reforms.

Q.

Market and industry players are paying a great deal of attention to how financial administration might change as a result of the new appointment of the Minister for Financial Services. At the press conference at the Prime Minister's office, you stated that you will follow the same policy line as former Minister Mr. Takenaka. Does this mean that at the moment, you have no policy difference whatsoever with Mr. Takenaka? How do you intend to demonstrate your individual characteristics?

A.

We have been striving to ensure the stability of the financial system by steadily implementing various measures following the ''Program for Financial Revival'' and the ''Action Program concerning the enhancement of Relationship Banking Functions''.

As a subsequent program, we will formulate the ''Program for Concentrated Consolidation of the Financial System (tentative name)'', in which we plan to incorporate measures and directions to stabilize and strengthen the financial system and provide diverse and advanced financial functions to meet users' needs.

These measures and directions must lead up to the financial system strongly supporting the economic structural reforms, therefore we will push forward toward our goal.

As I mentioned before, activating regional economies and revitalizing SMEs are extremely important issues in the economic structural reform nowadays. I have worked on the economic and industrial policies and SME policies and now I strongly believe that these policies and the financial administration should be carried on together to achieve the goals that I mentioned.

Regions and SMEs potentially have great powers and precious values that we should not lose. If financial administration can do something to derive these powers or refine these values, what we should do is to implement the policy strongly and steadily.