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Q.
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With regard to the integration of the management of regional banks, the Fair Trade Commission announced that it would approve the integration of the management of the Fukuoka Financial Group and the Eighteenth Bank on August 24th. In the end, to lower the share of a new banking group in Nagasaki, this integration of the management was approved after the transfer of nearly 100 billion yen in credited loans. What are your views on this?
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Given that population declines and such had made it extremely difficult for regional banks to operate – an issue not limited to Nagasaki – and in keeping with the Fair Trade Commission’s rules, it would be difficult to deal with the problems that would arise if regional banks were to disappear in that region. In that sense, the Financial Services Agency has had a variety of things to say in ensuring that this issue is properly addressed. The Fukuoka Financial Group and the Eighteenth Bank have taken steps in the form of transfer of credited loans, and I think it is important that the financial institutions involved in this transfer of credited loans tackle this matter from a customer-first approach. While I do not know all of the details, I think that this might be a move in the right direction. However, there is nothing more I can say until we see more clear-cut results, but I feel that this issue is going to be properly addressed to prevent the problems in Nagasaki.
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Regarding this matter, I believe the Abe administration will start to discuss the revision of the Act on Prohibition of Private Monopolization and Maintenance of Fair Trade, and I suppose that these discussions would go beyond regional banks to touch more broadly on what to do about mergers of global companies. What issues do you plan to bring up in future discussions?
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It is difficult to define what constitutes a global company, so at the present stage we must consider a variety of things, including the situation for discussing such matters. It has been suggested that these discussions take place at the Prime Minister’s Office, but I think we need to give some more consideration on the situation. Financial Services Agency need to address the disparities among regions arising from concentrations of population in some and decreases of population in others, and Nagasaki has become one example of this, but not the only example. When we consider whether it is possible for about 60 regional banks to continue doing business, we need to recognize that specific companies and banks face challenges, but financial institutions have a huge role to play in maintaining universal service. Maintaining this role by financial institutions in keeping with the only Fair Trade Commission’s current rules means adopting an approach such as that being taken in Nagasaki. It may turn out that this approach can be done in some places but not in others, so we must consider the issue on a case-by-case basis. In any case, the idea that high-quality universal service able to meet the needs of the prefecture’s residents could be provided instead by the post offices, given that lending would also be involved, could lead to a variety of problems. We also need to determine the perspectives and angles from which to discuss this matter, and if we should start out with an overall picture that is not limited to financial services, a number of issues could be arisen. We have not yet decided what issues to raise and when and where to discuss these issues, though, so I cannot say any more than that at the moment.
