Press Conference by Shizuka Kamei, Minister for Financial Services
(Tuesday, May 18, 2010, from 8:56 to 9:28)
Last Friday, on May 14, Shinsei Bank and Aozora Bank announced the annulment of their merger agreement. What are your thoughts on this?
It can't be helped if they don't want to go ahead. It is neither a matter for the Financial Services Agency (FSA) to tell and force them to merge, nor a matter as simple as making them automatically stronger through the merger. It is the same as a marriage: there is no point in getting together when they are not in love with each other and committed to making combined efforts. The FSA is not in a position to say whether it is good or bad.
Nonetheless, we would like both banks to make serious managerial efforts in the future, especially because public funds had been used to recapitalize Shinsei Bank, etc. I told off senior officials of the FSA the other day about this; the Japanese government has a 25% stake in Shinsei Bank through such public funds, yet, just because a foreign company has a 30% stake in the Bank, an officer dispatched from the foreign company is receiving a high salary exceeding 100 million yen, which is more than five times the amount of Japanese officers' salary. I told off the administrative staff of the FSA for ignoring such situation, considering what supervision means.
The top management must act properly-including addressing such situation-as they have received aid, not for free, though, in the form of taxpayers' money, even at a cost. In that sense, the FSA needs to provide guidance in a strict manner to both banks in the future.
Mizuho Financial Group announced a capital raising of up to 800 billion yen, and in conjunction with this, the three chairmen of Mizuho Financial Group, Mizuho Bank and Mizuho Corporate Bank would all resign and assume the position of special advisor of Mizuho Financial Group. What are your views on this announcement?
I believe their intention is to execute management properly in the future. As to whether it is good or bad, the FSA is not in a position to make any comments. I assume their action is based on their belief that it is good for the banks, so I hope they make their utmost efforts as a good bank in the future.
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