Press Conference by Taro Aso, Deputy Prime Minister, Minister of Finance, and Minister of State for Financial Services

(Excerpt)

(Friday, September 16, 2016, 10:10 am to 10:25 am)

[Questions and answers:]

Q.

Yesterday the FSA announced the introduction of benchmarks as a means of identifying how much regional banks contribute to the revitalization of their local economies. I know regional financial institutions have a very important role to play in provincial regeneration, but Minister, could you tell us your thoughts on what sort of things you expect from these institutions?

A.

In the case of regional banks, including credit associations, credit unions, second-tier regional banks, and so on, namely banks in regions, the difference between them and city banks is, put simply, nothing to do with the amount of money they have, but rather, that their employees don’t get transferred to other regions. So because their employees remain in that region, without being transferred, it is said that they are the most knowledgeable organizations about their regions. When we say regional banks, we’re referring to credit unions and regional financial institutions. So as those people would know if they looked at those indicators, those so-called benchmarks, everyone says that that place, that your place, that my place is doing a good job. How many clients does each person have, how much is being lent without collateral, how discerning are they, and how many companies have been nurtured? Having to answer all these questions with figures is one way to get them to reflect on their actions. It’s a good exercise for them. So when you consider the intermediary function, when you think about customers, they’re working really hard now. They’ve certainly come a long way in the past three years. I don’t think there’s any doubt about that. But becoming self-complacent, that’s not going to garner them any trust, so as a realistic option, I think that responding with figures will also get them to reflect on themselves. They’re often criticized for not doing enough to revitalize their regions, for still refusing to lend without collateral, for still being pawn shops, and this could be a chance for such things to change.