Provisional Translation

Q.

It has been reported that there have been around 20,000 cases of improper sales of investment trust products to the elderly at Japan Post Bank, in which internal rules, such as checking the customer’s health condition, were neglected. With the addition of improper sales at Japan Post Insurance, it appears as if the governance of the entire Japan Post Group is not functioning properly. What is your opinion on this?

A.

I’m aware of that report. In general, when financial institutions sell investment trust products to the elderly, they have various internal rules that stipulate sales solicitation must be conducted properly, although they differ depending on the institution. We can judge in this instance that this principle was likely not being properly followed, and that of course Japan Post Bank must conduct investigation. They revealed the fact around July, I believe. At that time, over 10,000 cases came to light, if I recall correctly. As that was the case then, this time they probably planned to announce that a careful investigation revealed around 20,000 cases. However, the media report got to first. An onsite inspection is currently being carried out on Japan Post Insurance for improper acts related to switching to new financial products or insurance products. In any case, regarding issues including those of Japan Post Insurance and Japan Post Bank of the Japan Post Group, results reports are being released from the point of view of compliance as well as management oversight systems. Upon seeing those reports, we must respond to the situation in the proper manner. However, the official and detailed results have yet to be released.