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Press Conference by SUZUKI Shunichi, Minister of Finance and Minister of State for Financial Services on (November 26, 2021)

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[Questions and answers:]

Q.
With regard to the administrative actions against Mizuho, please explain again in detail your thought on how to strengthen supervision to ensure recurrence prevention as the minister in charge of financial affairs.
A.
It is of course necessary for the bank to surely take measures to prevent a recurrence of system failures. But, considering that the problems pointed out as the root causes of the series of the latest system failures also apply to its large-scale system failures that occurred in the past, I think that the bank needs to make its self-cleansing mechanisms work substantially and sufficiently. In light of these points, Mizuho Bank and Mizuho Financial Group should carry out concrete initiatives for strengthening organizational ability to take action and changing the mindsets of employees. The FSA will closely follow up the progress of the bank’s initiatives.
Q.
Regarding Mizuho Bank’s latest system failures and those past  in 2002 and 2011, you said that the same problems had been also observed. Then, Mizuho took measures to solve them on those occasions, and the FSA strictly supervised, I think. With the orders issued today, how will the bank make improvements? I think a change of management will surely be necessary. How do you expect the bank to make improvements autonomously? How do you think the bank should improve the issues that it has failed to cope with for 20 years?
A.
As we have examined the causes of the latest system failures and issued the improvement order, we will closely follow up the actions that Mizuho will take from now on. As I told you earlier, we consider that the root causes of the series of the system failures are the management’s disrespect for system-related risks, expertise and actual status. The root causes are also the headquarters’ lack of sensitivity to the impact on customers, disrespect for the actual status of the sales ground operation, and corporate culture to refrain from saying what needs to be said and to only do what was instructed. In light of these root causes, Mizuho Bank and Mizuho Financial Group are expected to carry out concrete initiatives for strengthening organizational ability to take action and changing the mindsets of employees. In order to ensure that these incidents will not occur again, we will keep an eye on Mizuho’s efforts for changes and will follow up the progress.
Q.
This is an additional question regarding the administrative actions against Mizuho. The resignation of the top management, including Mizuho Financial Group’s President Sakai and Mizuho Bank’s President Fujiwara, was announced. The new management will be established in or after next April, I think. Regarding the improvement of the corporate culture and related reforms as you mentioned, how do you want the bank to change in the future?
A.
Regarding personnel matters, Mizuho Bank and Mizuho Financial Group autonomously deliberated and decided in response to the business improvement order we issued, and therefore, it is their own decision, I think. With regard to the future, it is of course necessary for them to surely carry out measures to prevent a recurrence of the incidents, and as I told you earlier, they need to make the self-cleansing mechanisms work sufficiently in light of the root causes of the series of the latest system failures as I cited earlier. We strongly hope that Mizuho Bank and Mizuho Financial Group will carry out concrete initiatives for strengthening organizational ability to take action and changing the mindsets of employees.
Q.
This is another question related to Mizuho. Why is it that only Mizuho has had repeated system failures and why have business improvement orders been issued thereto repeatedly? What do you think is a problem unique to Mizuho Bank?
A.
I cited several factors earlier. Multiple factors combined to cause the system failures of Mizuho Financial Group and Mizuho Bank. It is not a matter of comparison of banks. The FSA took action against system failures and pointed out problems through sufficient investigations.

This news item was originally published by the Financial Services Agency (FSA JP). For more information, see the Source Link.

Regulator Information

Abbreviation: FSA
Jurisdiction: Japan

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