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Fuji Bank, the top shareholder and main creditor bank of Yamaichi Securities Co, knew by Oct. 6 that the brokerage had hidden debts of about 260 billion yen, a Fuji executive said Monday.

Fuji, realizing the losses stemmed from illegal “tobashi” trading activities, urged Yamaichi to quickly come up with plans to cope with the massive debts and reconstruct the firm as well as disclose the facts, said Toshiyuki Ogura, senior managing director of the bank. The bank has neither discussed the issue with the Finance Ministry nor confirmed if Yamaichi reported it to the ministry, Ogura told reporters.

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