Sumitomo Trust & Banking Co. may not be the sole buyer of the troubled Long-Term Credit Bank of Japan, Chief Cabinet Secretary Hiromu Nonaka said Wednesday."We had initially hoped for smooth realization of the planned merger between the two banks," he said. "But the LTCB is now expected to be put under state control in line with a new financial stabilization scheme. As such, it would be difficult to specify any particular bank as the buyer of the LTCB." The remarks clarified Finance Minister Kiichi Miyazawa's suggestion Tuesday that the government intends to auction LTCB shares and sell them to the highest bidders to minimize the burden on taxpayers.During the question-and-answer session Tuesday at an ad-hoc Upper House committee, the finance chief said it would be "common sense" to auction the LTCB shares after putting the ailing bank under state control. A set of banking reforms, which was passed by the Lower House Friday and is now being discussed in the Upper House, would facilitate controlled liquidation of failing banks. The LTCB case is expected to become the first one handled under the new plan.
