Press Conference by Kaoru Yosano, Minister of Finance and Minister for Financial Services and Economic and Fiscal Policy

(Excerpt)

June 19, 2009

[Questions and Answers]

Q.

Regarding financial supervision, the U.S. administration announced a reform plan that puts major financial institutions under the supervision of the Federal Reserve. What is your view on this?

A.

The supervision of banks in the U.S. has been conducted since the 1920s, and it was not necessarily insufficient until a certain point in time. In a financial crisis like this, two major issues arise. One is information disclosure concerning the management of banks. Many banks are engaging in various off-balance sheet transactions. In order to show the degree of the soundness of banks, we need regulation that ensures appropriate disclosure regarding such various off-balance sheet transactions. The other issue is regulatory reform intended to properly protect investors and depositors. As the plan announced by the U.S. administration includes detailed provisions for the reforms regarding these two major issues, we appreciate it as an important regulatory reform proposal from the perspective of ensuring the soundness of banks and protecting investors and depositors.

(End)