Mizuho Officials Face Questions in Parliament on Crime Loans
Japanese lawmakers plan to question Mizuho Financial Group Inc. (8411) officials this month on its loans to crime groups, ramping up political pressure on top executives at the country’s third-biggest bank by market value.
The lower house financial affairs committee will seek testimony as part of plans to discuss the crime-loan issue in the week starting Nov. 11, ruling Liberal Democratic Party lawmaker Isshu Sugawara told Bloomberg News in Tokyo today.
Mizuho President Yasuhiro Sato is under pressure to explain how his bank failed to address 200 million yen ($2 million) in loans made to members of criminal organizations. The Financial Services Agency is broadening its probe to include inspections of Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. (8316) from Nov. 5.
Tokyo-based Mizuho this week submitted plans to improve internal controls and cut pay for executives including Sato, who has said he was in a position to know about the transactions from documents circulated in executive meetings. He said this week he doesn’t recall seeing the issue highlighted in the reports.
Shinsei Bank Ltd. (8303) yesterday became the second lender to reveal loans with crime syndicates. President Shigeki Toma said his company’s Shinsei Trust & Banking Co. unit had more than 10 transactions with so-called antisocial groups through a consumer credit company. Tokyo-based Shinsei discovered the loans following an internal probe after Mizuho was penalized by the FSA, Toma said at a briefing.
To contact the reporter on this story: Takashi Hirokawa in Tokyo at firstname.lastname@example.org
To contact the editor responsible for this story: Chitra Somayaji at email@example.com