Press Conference by the Minister for Financial Services

(Excerpt)

September 21 , 2005

Q.

Having been reappointed to Minister for Financial Services, how do you evaluate the efforts you have made over the past year in office? Please also describe the resolutions you have made and the challenges you have taken on following the reappointment.

A.

Looking back on the past year, various things happened in financial administration. Among them, the major challenge I had been faced with was to complete the task of financial revitalization, specifically, to fulfill the targets set forth in the Program for Financial Revival. I am deeply moved by the fact that the accomplishments have exceeded the targets in the Program for Financial Revival, as a result of implementing the measures set forth in the Program, and due to the tremendous efforts made by the parties concerned. Furthermore, we formulated and announced the Program for Further Financial Reform as the financial administration guideline following the Program for Financial Revival, and then the work schedule. As I have been reappointed, I will make the utmost efforts to build a dynamic financial system from here on, by implementing the measures set forth in the Program for Further Financial Reform. As financial reform is an extremely important field in promoting structural reform, I hereby reaffirm my determination to do my very best to carry out financial reform.

Q.

What are the prospects for submitting the bill for the amendment of the Banking Law, which was pushed to the back burner on the grounds of being postal-related?

A.

The revision of the bank agency system is regarded as an extremely important challenge as part of the regulatory reform in the financial sector. Accordingly, we need to carry out institutional reform in light of further improving user convenience. We will make coordinated efforts with members of the ruling parties to submit the bill for this purpose, and we will study hard to have the bill submitted. We cannot say when the bill will be ready for submission at this stage, but we are committed to working hard towards its submission.

Q.

This question relates to an individual case: it appears that confidence in the accounting system is wavering due to the series of scandals involving Certified Public Accountants (CPAs). Under these circumstances, the Chairman of the Japanese Institute of Certified Public Accountants (JICPA) held a press conference yesterday, which seemed like an emergency press conference. At the press conference, he announced measures to prevent such incidents from recurring and new initiatives aimed at preventing collusion between companies and accountants. How do you rate the efforts of JICPA--a self-regulatory body--and the Chairman's approach? How will the Financial Services Agency (FSA) tackle this kind of problem?

A.

The respective missions and roles that CPAs and auditing firms must fulfill are extremely significant in ensuring confidence in corporate financial information. It is hoped that members of JICPA will make solid efforts to restore such confidence, with an acute awareness that regrettably, confidence might be undermined as a result of the latest series of incidents.

In particular, the importance of organized audit is becoming greater than ever before, as the economic climate is undergoing dramatic change and Japan's socioeconomic environment itself is becoming increasingly complex, diversified and globalized. Under these circumstances, auditing firms are encouraged to make consistent efforts to conduct audits in a proper fashion.

(End)