The Financial Services Agency will begin a joint liaison meeting with two other ministries in an attempt to resolve the financial sector's bad-loans and other sectors' overborrowing, Financial Services Minister Hakuo Yanagisawa said Friday.

The meeting will involve the FSA, the Economy, Trade and Industry Ministry, and the Land, Infrastructure and Transport Ministry, Yanagisawa said.

The plan was reported at an informal Cabinet meeting earlier in the day.

The forum was originally proposed by Yanagisawa, who noted the importance of the financial and industrial sectors revitalizing themselves as "two wheels" of the economy to spark a true recovery.

Yanagisawa said the liaison meeting will comprise high-level officials from his agency and the two ministries.

The members will meet once a month to exchange opinions and information, and will seek ways to encourage more drastic reforms and realignments in construction, retail and other sectors burdened by overborrowing.

Asked why the forum was set up only by the FSA and the two ministries, Yanagisawa said it is an attempt "to address first the problems at sectors that many people consider should be resolved."

He also said a proposal by New Komeito -- a junior coalition party -- to establish an administrative committee to encourage corporate restructuring could overstep its bounds.

That kind of committee, which could exert greater influence than the liaison meeting he suggested, would pose "delicate" problems as to how a proper balance can be maintained between private-sector affairs and administrative power, he said.

Trade Minister Takeo Hiranuma told reporters separately that he is willing to "create the environment and guide (corporations for realignment), while respecting corporations' independence."

Said Chikage Ogi, minister of land, infrastructure and transport: "If corporations fail and their accumulated technologies are lost, it is a national loss."

The forum should take that point into consideration, she concluded.