Press Conference by Taro Aso, Deputy Prime Minister, Minister of Finance, and Minister of State for Financial Services

(Excerpt)

(Friday, April 1, 2016, 9:09 am to 9:23 am)

[Questions and answers:]

Q.

I have a question about Japan Post. The caps at Japan Post Bank and Japan Post Insurance have been increased as of today. Also today, Mr. Masatsugu Nagato has also become president of Japan Post and Mr. Norito Ikeda has become president of Japan Post Bank. What are your hopes for the Japan Post group’s new management team?

A.

I’ve been saying this for a long time, but unlike that period a long time ago when they didn’t have enough money, banks have money now, but there’s no demand, there is few to lend to. Bank management in these circumstances is different from bank management before. Japan Post Bank has now entered the market, and regarding bank management, I have said on several occasions that it will be good if the postal bank has a president who are able to sophisticate the investment and risk management, understand research needs to be conducted on financial products that can take advantage of its huge network of post offices, which makes it unique among banks, and that ties need to be forged with private-sector financial institutions, which have superior capabilities in terms of lending and screening. I feel that someone who possesses such capabilities has taken up the post.

Q.

Regarding the realignment of regional banks, today saw the merger of the Bank of Yokohama and the Higashi-Nippon Bank to form Concordia Financial Group. Please tell us your thoughts on the ongoing realignment of regional banks.

A.

With an aging population and a low birthrate, a lot of regional banks are integrating, merging, engaging in M&A, there are lots of terms for it, but as a corporate manager, I can tell you that the approach to management obviously differs from bank to bank, so I hope that the benefits of that can be demonstrated to the greatest extent possible. I think that the issue is how to meet regional demand. Regarding the development of regional economies, regional banks are rooted in provincial regions so they know their regions really well. They might not have as much local knowledge as credit unions, but as regional banks, they are firmly established and have strong human connections in the prefectures in which they are based. These are their strengths, and their managers will decide how to make them more effective. In accordance with this decision, how will the Bank of Yokohama be managed? I think a lot will depend on the abilities of the manager, and I hope that the operations of the bank will go well.