Press Conference by SUZUKI Shunichi, Minister of Finance and Minister of State for Financial Services

(Excerpt)

(Tuesday, March 5, 2024, 8:44 am to 8:49 am)

Q.

Could you please give us your response to the announcement on March 1 on the merger of credit associations (shinkin banks), the first of its kind in Tokyo in 19 years? And as “a world with interest rates” is expected to arrive, what role should regional financial institutions play in the community in which they operate? Please let us know your thoughts on this. Also, do you think whether further realignment is needed as a way to strengthen management foundations? 

A.

Last week, on Friday, March 1, AdachiSeiwa Shinkin Bank and Toei Shinkin Bank announced that they had reached a basic agreement on their merger, and I would like to refrain from making specific comments on the merger itself because they merged based on their managerial decisions. However, regional financial institutions, including credit associations, are usually strengthening their financial and agency functions, as well as enhancing the value of businesses in the community through not only funding but also other types of support, and therefore, they are expected to contribute further to the recovery and growth of regional economies.
Even as the hard business environment continues, including very low interest rates and the population decrease, the Financial Services Agency will urge regional financial institutions to push initiatives for strengthening management foundations based on a hard look at what things will be like in the future and displaying their financial and agency functions so that they can appropriately fulfill the roles I mentioned earlier.
What I understand is that whether mergers will continue in the future depends on the managerial decisions of the respective credit associations.