Press Conference by the Minister for Financial Services
July 29 , 2005
Yesterday, a meeting was held by the Working Group on TOB for the first time. Please describe the need and the purpose of reviewing the TOB system at this point, as well as the rough timeline in general.
I have been informed that the Working Group convened a meeting yesterday as just mentioned, and that the members engaged in lively discussions about the TOB system and other matters. Issues raised in the discussions on the TOB regulation include whether it is necessary to reexamine the regulation in view of maximizing corporate value and shareholders' interests, and whether it is necessary to further improve the transparency and fairness of securities transactions. In the process, due consideration must be given so that the smooth business restructuring of companies will not be undermined. In our opinion, the TOB regulation should be studied broadly from such viewpoints, and we hope the Working Group on TOB will deliberate the matter in a vigorous and speedy fashion. However, we cannot give a specific timeline for the future at this stage, as there are many issues that need to be studied.
The Financial Services Agency (FSA) has allegedly requested that a report be made due to some system-related concerns over the merger between the Bank of Tokyo-Mitsubishi, Ltd. and UFJ Bank, Ltd. What is your view on the progress of the work done to integrate their systems at this point, including its impact on the banks' integration process?
We have been receiving various reports from the parties for some time, as the merger between banks is subject to FSA's approval. However, I would like to refrain from commenting about the specific nature of these reports. In general terms, it is necessary to realize the merger between banks smoothly without causing any inconveniences to customers, and it is important for the parties to be fully prepared, including preparation of the system, where security and stability need to be ensured by thoroughly minimizing the risks.
In regards to Bank of Tokyo-Mitsubishi, Ltd. and UFJ Bank Ltd, your position in general terms is that the merger between banks requires full preparation, including system-related preparation. But does it mean that regardless of the timeline set by the banks, they should go ahead with integration only after making full preparation, including system-related preparation?
Again, let me explain this in general terms, without referring to any individual cases. It is extremely important to avoid causing inconveniences to customers and users in the event of a merger, including system-related inconveniences. Based on this perspective, if there are problems in the system, then, it is extremely important to thoroughly reduce the risks and thereby ensure security and stability, in order to realize a smooth merger. It is very important to make full preparation, including preparation in such areas.
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