Foreign exchange movements excessive in both speed and level are unwelcome among Japanese financial institutions, the head of the banking industry said Tuesday.
“Excessive (exchange rate) movements, given the various economic difficulties faced by Asian economies, may have an (adverse) effect on the international economy and are undesirable,” Satoru Kishi, chairman of the Japan Federation of Bankers Associations, said at a regular news conference.
Kishi acknowledged that a weaker yen would help some export-related firms positively while having the negative effect of pushing up the price of imported goods, but for financial companies, the situation is “on the whole undesirable.”
Kishi, president of the Bank of Tokyo-Mitsubishi, also said he hopes the government’s 16 trillion yen economic stimulus package would lead to signs of an economic upturn by summer. “A self-sustained recovery may still be difficult, but I believe the package might serve as the locomotive for a brighter economy,” he said.
He also said his bank would have to redesign its securities business strategy following the business alliance forged between the U.S. financial house Travelers Group and Nikko Securities Co., with which Tokyo-Mitsubishi had close ties. “Developing our ties with Nikko had been an option (in our strategy), but that has disappeared, and so we will need to review (our plans) and work toward beefing up our own securities affiliate,” he said.
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