Press Conference by Shozaburo Jimi, Minister for Financial Services

(Excerpt)

(Tuesday, March 1, 2011, from 11:05 a.m. to 11:41 a.m.)

[Opening Remarks by Minister Jimi]

Late last night, the budget was passed in the House of Representatives.

Today, the council on comprehensive measures for suicide prevention held a meeting before the cabinet meeting. As I am a member of this ministerial meeting, it is important for the Financial Services Agency (FSA) to maintain close cooperation with the prefectural consultation offices for suicide prevention with regard to the multilateral debt problem. I learned today that March is a month when the number of suicide deaths is particularly high. According to the Prime Minister, the years 1997 and 1998 - I have often mentioned the failures of Hokkaido Takushoku Bank and Yamaichi Securities that occurred during this period - were “suicide outbreak periods.” For the 13 years since then, the annual number of deaths due to suicide has exceeded 30,000 every year. As many ministries are involved in this matter, the Prime Minister issued an instruction for efforts to reduce the number.

The FSA is making efforts to ensure cooperation between consultation counters related to multiple debts at local Finance Bureaus, prefectural and municipal offices, and consultation offices for suicide prevention, and I said that the FSA will step up such efforts.

That is all I have to say.

[Questions & Answers]

Q.

It has been decided that the Financial System Council will hold a meeting on March 7. This will be the first meeting since 2009. I presume that the key issue will be the council's relationship with political leadership. Could you explain the role of this council and what the major themes of discussion will be for the moment?

A.

As you may know, the members of the Financial System Council changed on January 25. A joint meeting of the Financial System Council and the Sectional Committee on Financial System will be held on March 7.

What specific themes should be discussed is now under consideration. Regarding the issues which the FSA wants to be discussed, I, together with the Senior Vice Minister and Parliamentary Secretary, will ask for recommendations.

I will seek experts' opinions from the Financial System Council, which comprises people with broad experiences and various practical experiences. However, as political leadership is the basis of administration, we will establish subcommittees by theme and select members from among experts as necessary. I would like to operate this council in such a flexible manner.

Since advisory councils tend to be used as fronts for the bureaucracy, I will take care to avoid that. Moreover, if an expert sits on an advisory council for a very long time, the membership may become a vested right, creating a problem for political parties and government organizations. In that sense, a change of government is useful as an opportunity for the renewal of council members, although I greatly appreciate the significant contributions made by long-serving members.

While councils are attached to administrative agencies, the general public, media people, and politicians should always consider how councils should operate as an important theme.

Q.

I have one more question, which concerns the Tokyo Stock Exchange's (TSE) goal to list its stock at an early date after fiscal 2011. If the TSE is listed, it will lead to the realignment of Japanese exchanges and will affect the plan to establish a comprehensive exchange. What is your view on these matters?

A.

I understand that you are seeking my comment on a media report that the TSE may list its stock by the end of this year. However, I am not aware of any announcement made by the TSE in relation to the media report you mentioned. As you know, the Financial Instruments and Exchange Act requires approval by the FSA when the holding company of an exchange seeks to list its stock. When an application for such approval has been filed, the FSA will process the application in an appropriate manner.

Q.

Regarding the SME Financing Facilitation Act (Act concerning Temporary Measures to Facilitate Financing for SMEs, etc.), there are concerns that as the enactment of a bill to extend this act is being delayed in the current Diet session, the law will expire at the end of March. Could you tell me what impact you expect if the law expired, what you are going to do in order to avoid a period of legal void, and whether it is possible to do something despite the absence of a legal basis if such a void occurs?

A.

As you can see from questions and answers in the Diet, there are strong calls from outside the ruling coalition, too, for the extension of the SME Financing Facilitation Act. Although this is a law with a sunset clause, there are opposition parties very eager to extend it, so I have strong expectations for the extension and I am not thinking of what to do if the bill to extend it is not enacted. In light of the current state of affairs and the critical importance of the law for the survival of small and medium-size enterprises (SMEs), we will do all that we can do to have the bill enacted.

As you know, financial institutions have received more than one million requests for the modification of loan terms and met more than 90 percent of them, which means that this law has been very effective. Although this act is scheduled to expire at the end of a two-year period, which falls on March 31 this year, I, as the head of the administrative agency that submitted the bill, would like to have it enacted by all means, as some opposition parties are eagerly supporting it, so I am not thinking of what to do if it is not enacted.

SMEs are like living things. Moreover, I hope that financial institutions will aim to perform the consulting function. The required paperwork will be reduced by 20%, as I have said. This law, for which we are seeking a one-year extension, is important for Japan to overcome deflation and recession. Associations of SMEs are very strongly supporting it and some opposition parties are also strongly supporting and recommending it. Therefore, until March 31, I am strongly resolved to continue doing my best on my responsibility to have this act extended.

(End)