October 7, 2004
Financial Services Agency
The Government of Japan
Administrative Action on the UFJ Bank
- On June 18, 2004, Financial Services Agency [hereinafter referred to as the ''FSA''] ordered the UFJ Bank [hereinafter referred to as the ''Bank''] based on Article 26.1 of the Banking Law to strengthen its internal controls to properly receive the FSA's inspections and to enhance compliance functions because, in the Bank, deeds that were considered to be ''evasions of inspections'' of Article 63.3 and 64.1.(2) of the Banking Law [defined, in Article 63.3, as ''acts to give no answer or false answers to questions of inspectors or to reject, obstruct or evade inspections based on Article 25.1 of the Banking Law''] and a number of inappropriate responses to the inspections had been identified during the FSA's inspection.
In view of the serious illegality of the Bank's evasions of inspections, the FSA has filed charges with the Public Prosecutor's Office in Tokyo.
- In view of the serious illegality mentioned above, the FSA also took today the following administrative action on the Bank based on Article 27 of the Banking Law.
- The administrative action this time around is based on the past evasive conducts under the former management.
The bank is currently making efforts to enhance the governance function following the Business Improvement Order issued by the FSA on June 18 and the Business Improvement Plan submitted by the Bank on July 26 in response to the order. The FSA looks forward to seeing a steady progress made by the new management of the Bank in this regard.
Administrative Action based on Article 27 of the Banking Law
Between October 18, 2004 and April 17, 2005 inclusive, no lending to new customers (defined as those who do not have existing transactions) is allowed to be extended by Tokyo Corporate Banking Office and Osaka Corporate Banking Office of the Bank.
Loans that are applied by customers before the day the suspension order above is issued, consumer loans including housing loans, loans for small and medium sized enterprises and deposit-backed loans are exempted from the suspension.
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