Press Conference by Shizuka Kamei, Minister for Financial Services

(Excerpt)

(Thursday, December 17, 2009, from 10:04 a.m. to 10:26 a.m.)

[Opening Remarks by Minister Kamei]

Good morning.

Today, I do not have anything particular to report to you. Regarding the compilation of the budget, the ruling parties and the government have started to work out the details, although I would not yet say that the budget compilation work has reached its climax. So, the People's New Party plans to submit its budget request to the government today. Our request partly overlaps with the request submitted yesterday by the DPJ (Democratic Party of Japan). Under the current economic conditions, especially, the annual budget will have a significant impact and will affect the people's everyday lives. Therefore, we need to fully devote ourselves to the compilation of this budget, which will be the first under the Hatoyama government.

Do you have any questions?

[Questions and Answers]

Q.

I would like to ask you about the strengthening of the capital adequacy ratio requirement for major banks. You have been saying that the strengthening of the requirement should be considered carefully in light of the circumstances of individual countries. Currently, negotiations conducted at the Basel Committee (on Banking Supervision) are moving toward setting a fairly long transition period for the full implementation of future new regulations. How do you view this situation?

A.

Since before our delegation departed, I have been arguing that Japan will not need to conform to the kind of regulation that the United States has proposed. The United States should, if I may say so, mind its own business. Although the United States has made its demands to Europe and others, it should, first of all, restore order to its own financial system. Japan has its own circumstances. Of course, we do not have any objections to the idea that in the future, standards around the world should converge so as to strengthen the health of financial institutions in individual countries. I have told our delegation to argue that Japan's current circumstances do not allow us to conform to what the United States has proposed.

Japan's argument apparently won out, as Europe closed ranks with us.

(End)