Japan Post Bank seeks ministry OK to enter into housing loan business

JIJI

Japan Post Bank has filed for government approval for its plans to start new operations, including offering housing loans.

The banking arm of government-held Japan Post Holdings Co. submitted applications Monday to the Internal Affairs and Communications Ministry and the Financial Services Agency.

Separately, Japan Post Insurance Co. filed for government approval for its plan to change the structure of educational endowment insurance to introduce lower-priced policies.

The applications reflect decreases in assets of the bank and insurer. Japan Post Bank held some ¥176 trillion in outstanding deposits at the end of March, more than the amount at any other Japanese bank, but the balance has been on the decline. At Japan Post Insurance, the number of insurance contracts in force has fallen almost by half in the past decade.

The ministry and the FSA will decide whether to approve the plans, based mainly on the opinions of a special panel checking the privatization of the Japan Post group.

In August, the panel, chaired by Toshiba Corp. consultant Taizo Nishimuro, announced guidelines on the new businesses that will be permitted to the Japan Post group, following enactment of the revised Japan Post privatization law in April.

In the guidelines, the panel effectively expressed support for the bank’s full entry into housing loan operations. This has drawn complaints, however, mainly from the private sector.

Japan Post Bank applied to start housing and other loans to individuals, sales of fire insurance policies, and corporate loans.

The bank has some experience in housing loans through a tieup with regional lender Suruga Bank. Based on the knowhow it accumulated, Japan Post Bank aims to release loan products for self-employed people, the elderly and women as early as next April.

If housing loan operations are approved, the bank will terminate its tieup with Suruga, under which Japan Post Bank sells housing and other loan products of the regional lender.

Japan Post Bank will also consider selling housing loans for corporate employees, a field crowded with private-sector competitors. An official, however, said such loans would not be a main product for Japan Post Bank.