Postal savings should be privatized even though the public generally wants the service kept under state control, the head of the commercial banking industry said Oct. 14.Naotaka Saeki, chairman of the Federation of Bankers Associations of Japan, said discussion of postal savings should include the advantages enjoyed by a state-run enterprise such as tax exemption. “It would be unfair to leave (postal savings) simply because it is popular,” Saeki said during a regular news conference in Tokyo.Recent opinion polls by major news organizations have showed a majority of people favors the status quo. But Saeki, who is also president of Sanwa Bank, doubts that the majority took into account the unfair advantages in the postal savings system.Meanwhile, Saeki expressed support for a Cabinet-approved bill to revise the Deposit Insurance Law that would allow the use of funds from the Deposit Insurance Corp. to aid mergers involving two or more failed financial institutions until the end of fiscal 2000. It appears that the planned revision is intended to secure a sound environment for depositors and customers, he said, which in turn would reduce the costs of handling failed institutions.Critics say the revision could invite a moral hazard by allowing ailing banks to seek mergers dependent on the DIC. Saeki said that sufficient measures would be necessary to avoid the hazard.
Banker takes aim at reluctance to privatize postal savings