Press Conference by Shozaburo Jimi, Minister for Financial Services

(Excerpt)

(Tuesday, April 10, 2012, from 10:06 a.m. to 10:23 a.m.)

[Opening Remarks by Minister Jimi]

Today, I do not have any particular comments to make.

[Questions & Answers]

Q.

I will ask you about your assessment of the economic condition. For the past two weeks, stock prices have been declining, with the Nikkei Average dropping below 10,000, and the yen has been rising against the dollar and the euro. As concerns are growing over the impact on the economy, there have been calls in the market for additional monetary easing amid concerns over the impact on the economy. What is your assessment of the recent economic condition?

A.

That is a very important point. While we cannot say that concerns over the European fiscal problem have been dispelled, the financial and capital markets in individual countries have generally been recovering for the past several months compared to before as a result of efforts made by the EU, euro-zone countries and the ECB (European Central Bank).

On the other hand, the U.S. jobs data for March, announced last week, fell short of expectations, so some people think that there are moves to avert risk in the foreign exchange and other markets. As you know, according to the U.S. jobs data, the number of non-farm jobs was much lower than expected by the market. Although an increase of 205,000 jobs from the previous month had been expected, the number actually increased by 120,000. I think that there may be some moves to avert risk in relation to the U.S. economy.

However, as the minister in charge of overseeing the Financial Services Agency (FSA), I should refrain from commenting on market developments. In any case, the FSA will continue to closely monitor market developments with strong interest while maintaining cooperation with the Bank of Japan.

Q.

In connection with the case of AIJ Investment Advisors, the FSA is conducting a survey targeting all companies managing customers' assets on discretional investment contracts and the results of the first-round survey were summarized last Friday. Could you tell me again about the FSA's future actions?

A.

This is also a very important issue domestically. In light of the results of the first-round survey, which were announced last Friday, April 6, the FSA started a more in-depth, second-round survey targeting some companies managing customers' assets on discretional investment contracts on the same day. What is important is that the FSA will also gradually hold hearings with companies managing customers' assets on discretional investment contracts that are not targeted by the second-round survey.

That is all I have to say.

Q.

Could you tell me what points you would like to clarify, and now that the first-round survey has been completed, have any other companies like AIJ Investment Advisors been found?

A.

We take the current situation very seriously, so we intend to proceed with the second-round survey as soon as possible.

However, in the second-round survey, we need to grasp the actual state of asset management in detail, including the status of investment assets for each customer. Therefore, I expect that it will take some time to closely examine the contents of reports and grasp the actual state through hearings. As was explained in detail by the FSA staff on April 6, we may come across cases that require more in-depth additional investigation or inspection by the Securities and Exchange Surveillance Commission (SESC), so we have not decided on future actions, including whether or not to announce the summarized results.

Regarding the question as to whether we have found any problematic business operators, I would like to refrain from commenting on matters that could feed speculation, including whether we have found any problematic business operators.

I hear that independent investment advisory companies that are conscientiously conducting business held a meeting, which was also attended by House of Representatives members from the ruling party and the chairman of the Committee on Financial Affairs, in order to demonstrate that they are appropriately managing customers' assets. I hear that harmful rumors are posing a threat to independent investment advisory companies, so we also need to consider how to prevent the risk of harmful rumors.

(End)