Press Conference by Kaoru Yosano, Minister of State for Economic and Fiscal Policy and Financial Services

(Excerpt)

June 2, 2006

Q.

According to some press reports this morning, the Tokyo District Public Prosecutors Office and the Securities and Exchange Surveillance Commission (SESC) are investigating Murakami Fund on suspicion of violation of the Securities and Exchange Law. What is your current understanding of the situation, and what are your views on this matter, including its impact on the market?

A.

I have read the newspapers but have not been consulted about it, nor do I expect this kind of matter to be passed on to me. As the Japanese market has much depth, it is unlikely for it to be affected by this type of incident.

Q.

According to reports in the press, Sumitomo Mitsui Banking Corporation (SMBC) will urge the former President and other officers to pay back their remuneration. At the Diet and on other occasions, you have stated that the former President and other officers were also responsible; what is your assessment of the way in which responsibility was taken?

A.

I have never assessed the method of taking responsibility. As this is an internal issue for SMBC, members of the SMBC should work it out.

Q.

In regards to Murakami Fund just mentioned, the bill for the Financial Instruments and Exchange Law submitted at the current Diet session incorporates regulations on funds. Please describe the significance of the Law once again.

A.

One aspect is that the Financial Services Agency (FSA) needs to know what kind of funds are out there, and where they are. However, not all funds need to be registered or regulated, such as funds freely managed by a small group of friends. Of course, they must act in compliance with other laws and regulations. With that said, the spirit of the new Law is that funds in the broader sense--a typical example being funds which seek the participation of outsiders--must properly clarify their own existence and inform members of necessary matters.

(End)