(Provisional translation)
September 10,2010
Financial Services Agency

Summary of Statement by Minister of Financial Services
on Incubator Bank of Japan

1. At 7am JST today (September 10th,2010) , Incubator Bank of Japan, pursuant to the provision of Article 74(5) of the Deposit Insurance Act, notified to Financial Services Agency of Japan that the bank's assets are insufficient to meet its financial obligations.

Receiving the notification, FSA at 8am JST today, pursuant to the provision of Article 74(1) of the Deposit Insurance Act, ordered that the business and assets of the bank be placed under the management of a financial administrator.

Accordingly, the bank hereafter engages in appropriate operation under the management of the financial administrator.

2. With regard to the deposits, pursuant to provisions of the Deposit Insurance Act, the aggregate amount of principals, up to 10 million yen per depositor, and interests related to the principals will be insured.

Principals that exceed 10 million yen per depositor and interests related to the excess amount will be repaid depending on financial condition of the bank in accordance with a plan to be developed under civil rehabilitation procedure. This measure to insure deposit to a fixed amount has been taken for the first time since the legislation of the Deposit Insurance Act in 1971.

3. The failure of Incubator Bank of Japan does not affect borrowers. Borrowers continue to repay their debt in accordance with current contracts. FSA will expeditiously request credit guarantee corporations, government-affiliated financial institutions and financial related associations to take all possible measures to facilitate smooth provision of credit to borrowers.

4. FSA recognizes that the causes of the failure of Incubator Bank of Japan are unique to the bank, including realization of large losses to specific borrowers who have close relationships with the bank and a lost lawsuit regarding the claims related to SFCG, a business lender, that went bankruptcy. The failure will not have further effect on the financial system as a whole. Also the bank does not have a settlement function as it neither provides deposit for payment and settlement purposes nor participates in the inter-bank market. Thus, impact of failure of Incubator Bank of Japan does not affect stability of Japanese financial system at all.

5.FSA will continue to do its best to secure stability of financial system, protect depositors, and maintain a financial order in Japan.

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