[Hot Picks from the Financial World]
*   We deliver the hottest information of the times in this section, selected from among questions and answers given at the Minister's press conferences, etc.
If you wish to find out more, we invite you to visit the "Press Conferences" section of Financial Services Agency's website.
[Money-Lending Business Control and Regulation Law]

Q.  What aspects of the bill is the government going to emphasize to gain support during the discussion in the Diet?

A.  The problem we face now is that some lenders knowingly provide loans to borrowers with no or insufficient repayment ability and that borrowers also borrow at an interest rate so high that it is virtually impossible for them to pay, and what is of particular note is that they cannot help borrowing an unnecessary amount out of the fear of having no money, only to find themselves in the misery of being unable to repay.  Currently, both sides, lenders and borrowers, lack prudence.  With this in mind, I intend to approach the multiple debt problem from a perspective of clearing up such an aspect by placing the focus of discussion on encouraging prudence, naturally with a view to having the problem solved through joint efforts of the ruling and opposition parties.

(from the press conference following a cabinet meeting on Tuesday, October 31, 2006)

Q.  Please give us your opinion about what effect the new requirement for a money-lending business to notify, when closing down its business, to which party its credits will be assigned and what collection policy applies is going to have, or is expected to have, in cracking down on illegal moneylenders and other related steps in the future.

A.  The proposed Money-Lending Business Control and Regulation Law amendments, if actually enacted, will likely result in a considerable number of business closedowns.  In the light of business closedown procedures, this will come with credit and debt adjustments, which will then necessitate collection procedures for the debts that have become due or accelerated.  Any ensuing collection procedures carried out all at once or in such a fashion as would be called oppressive debt collection will likely bring about anxiety to and security concerns in society.  It was specifically in this sense that we have taken steps to add to and strengthen the requirements for items subject to notification upon business closedown; we also intend to work further on keeping dishonest businesses out and preventing acts of illegal collection by such means as credit and debt transfer, and also on ensuring user protection through and through by, among other things, finding out facts and sharing information, as well as enhancing cooperation with police and other relevant authorities.

(from the press conference following a cabinet meeting on Friday, November 10, 2006)

Q.  What do you think about the prospect of the reorganization of the industry that would result in the fewer number of businesses?

A.  As a reflexive effect of the reduced number of businesses, I'm hoping to see low-interest micro credit practices resembling those at Grameen Bank emerge and eventually grow as a new industry or a new type of business.

(from the press conference following a cabinet meeting on Friday, November 17, 2006)

[Securities tax regime]

Q.  Please tell us your idea, if any, about having some form of interim measure to address the impact in the event of its elimination.

A.  We have, thankfully, seen progress in the shift from savings to investment, and are now about to embark on a shift from indirect finance to direct finance.  When, however, those who are eager to make a business endeavor, which might come in various forms including, in particular, "challenge again" attempts, actually intend to make a move, especially those who do so in the form of an entrepreneurial start-up or in the setting of a regional economy, the current situation is still such that it is quite difficult to raise capital only by indirect finance.  Being so situated, we need to have a direct-finance-friendly perspective, which cannot be had without understanding stocks, which understanding is generated as an extension of real securities trading that, to that end, must be flourishing.  One view that corresponds to this standpoint is: the policy of tax rate reduction to 10%, though it is supposed to be a temporary measure, still has a long way to go until the goal expected of it is achieved.  It is based on such a view that I intend to keep it and feel strongly about doing so.

(from the press conference following a cabinet meeting on Friday, November 14, 2006)

[Non-payments by non-life insurers]

Q.  I believe, the FSA has made efforts in the form of administrative guidance etc., which it has undertaken for the furtherance of user protection, I would like to hear what you think about this succession of incidents

A.  They occurred in the third-sector product area covering, above all, healthcare and caregiving, which can be said to constitute a institutionalized security blanket in the society in which we live.  In this sense, the impact of non-payments is indeed quite significant.  I intend to strongly demand that the impact of such non-payments should be rectified.

(from the press conference following a cabinet meeting on Friday, November 2, 2006)

Q.  The FSA, as part of addressing the matter of non-payments by non-life insurance companies, issued an order under the Insurance Business Law against 26 non-life insurance companies with respect to non-payments of car insurance etc.  I would like to hear what you have to say about the intention behind it.

A.  I find it regretful that they failed to do what we wanted them to do, which is to adequately examine their non-payment cases in the past so that the FSA could get a clear picture of all of the incidents.  I'm hoping that executives of those non-life insurance companies will reflect on this matter sincerely and present solid action plans, such as an appropriate allocation of their management resources to deal with it.

(from the press conference following a cabinet meeting on Tuesday, November 21, 2006)


Q.  On the subject of Ashikaga Bank, could you please give us your thought, if any, about applications from foreign affiliates or funds, or others equivalent to them?

A.  I have no intention of arguing for its appropriateness or suitability.  Rather I would like to consider each of them individually, in an even-handed fashion, as a prospective acquiring party that is committed to meeting the three requirements previously mentioned.  I, for one, believe that the main point should be placed on whether, and how surely, a candidate can meet the three requirements, as judged from the sincerity of its attitude towards fulfilling them, regardless of whether it is foreign-affiliated or Japanese-run.

(from the press conference following a cabinet meeting on Friday, November 2, 2006)

Q.  Some bank has decided to eliminate ATM use fees. I would like to know how you see these actions, please.

A.  For the plan on removing fees for the use of ATMs located in convenience stores, I find that's very good.  I have a good feeling about the prospect that such a topic making news will prompt other banks to get better profits back to their users and serve their stakeholders more appropriately in the future.

(from the press conference following a cabinet meeting on Tuesday, November 21, 2006)

Q.  On the subject of interim financial results of major banks, in which record-high profits are posted, please tell us whether or not you now consider them to be in a full-fledged state.

A.  It does make me feel that they are finally entering into times of offense from those of defense.  That said, examining them case by case, I get a bit suspicious if they are doing as well as I wanted them to in their core business, and I also think that the special factor concerning reversal to the reserve is contributing to their results overall.  Is everything going well and could they, in a state similar to being fresh out of hospital, go straight to the National Stadium and compete in the 100 meters? - I doubt it.  Considering how they are now, they are still at the stage of recuperating at home after leaving the hospital; even though they can do as much as taking a walk, I still cannot feel free of worries about whether they are fit enough to participate in a competition.

(from the press conference following a cabinet meeting on Friday, November 24, 2006)

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