Press Conference by Kaoru Yosano, Minister of Finance and Minister for Financial Services and Economic and Fiscal Policy
May 15, 2009
[Opening Remarks by Minister Yosano]
I do not have any statements to make.
[Questions and Answers]
It is almost three months since you started to serve in the three ministerial portfolios of finance, financial services and economic and fiscal policy. Could you tell us how you feel when you look back at the past three months?
Always keeping wide awake at committee meetings is a challenge of sorts, so I am having a hard time. However, my tasks are simply an extension of what I was previously doing. In addition, as the FSA Commissioner is responsible for overseeing financial administration, I have to do my part as the Minister of Financial Services only when an incident of really great importance has occurred or when it is necessary to pass legislation in the Diet. Mr. Sato, the FSA Commissioner, is conducting all the administrative work on his responsibility, so my workload is just slightly more than that of two ministerial posts combined.
Today, many banks will announce their financial results. Could you tell us again how you feel about the financial results being announced at this time. In relation to this, major banks are expected to announce plans to increase their capital. What is your view on that?
In a time of recession like this, loans provided for capital expenditures have probably gone sour, and the valuation of stocks held by financial institutions, to which fair-value accounting is applicable, are likely to have declined, so losses cannot be avoided. In a situation like this, it would be better to set aside the reserves that should be set aside and write off the losses that should be written off so as to clean up the balance sheets.
As for the level of capital held by banks, we have had worries, and some regional banks are indeed trying to increase their capital by receiving public funds. We should be glad that major banks are planning to raise capital on their own.
I understand that you have called on major banks to use public funds based on the Act on Special Measures for Financial Functions. Do you have any opinion about the fact that all of the three megabanks are set to increase their capital on their own?
As the megabanks are private-sector banks, it is natural that they wish to raise capital from the market on their own. We have been worried about whether it is possible for them to do so under the current market conditions. However, we are very glad that they have the prospect of raising capital from the market, and they will not necessarily have to use funds made available by the government. As these funds are intended for emergency use, it would be ideal if they can raise capital from the market.
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