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Mizuho Financial Group, the world’s largest banking group, confirmed Friday that it has a backlog of at least 2.5 million incomplete transactions due to computer system glitches.

The problems are unlikely to be fully resolved until the end of next week at the earliest, executives said.

Around 105,000 transactions that were to have been completed Monday remain in the system. They include payments of utilities, phone bills and credit card bills. In addition, at least 3 million withdrawals by customers were recorded twice.

“We do not yet see when we will be able to complete all transactions during the day they are begun,” Fumito Ishizaka, managing director of Mizuho Holdings Inc., said.

Transactions must be dealt with in the order they are made and before subsequent ones can be completed, he explained.

A staff of 150 of Mizuho’s computer technicians are working to resolve the problem.

The glitches, reported in transactions nationwide, arose from delays in fully resolving a software problem that prevented transactions at Mizuho Bank’s ATMs when the new bank began operating Monday.

Several thousand transactions were delayed on Monday with around 7,000 ATMs failing to dispense money, despite bank records showing that money had been withdrawn.

Not only do the problems come as a major embarrassment to the bank, inviting irate comments from Cabinet ministers, they also indicate how corporate infighting has delayed efforts to integrate operations.

In addition to software glitches, bankers were simply unfamiliar with new operations, Ishizaka said.

“We expected the amount of transactions to grow when we integrated operations, but we should have prepared for three to four times the volume of transactions that most branches are used to,” Ishizaka said. “Ultimately, I have to say that we were unprepared.”

On Monday, Mizuho began operations of its two banks, Mizuho Bank and Mizuho Corporate Bank, which consolidated Dai-Ichi Kangyo Bank, Fuji Bank and the Industrial Bank of Japan.

But a relay computer failure caused malfunctions in the ATMs. Mizuho has been able to resolve the computer error causing the double deductions on payments, but has yet to confirm which accounts need to be credited.

The holdings company set up an emergency team Friday to deal with ongoing ATM problems.

Officials are blaming a system problem that prevents computers from differentiating customer data from Mizuho Bank and the group’s Mizuho Corporate Bank. The delays arising from the glitch are keeping transactions from being recorded for at least a day.

“We apologize for the great inconvenience we our causing our customers,” Ishizaka said.

Financial Services Minister Hakuo Yanagisawa said he will ask Mizuho Holdings Inc. for an explanation.

“I want the banks to report on the situation and come up with measures to improve and prevent this from happening again,” Yanagisawa said at a regular news conference.

Regulators usually only issue orders for financial institutions to improve their operations when their financial strength has deteriorated or they have violated regulations. Yanagisawa said Mizuho may be issued such a reprimand.

“It is questionable whether unexpectedly heavy preparations can excuse this trouble,” Yanagisawa said.

Mizuho Bank will continue to use the relay computer until early 2003, when it adopts a a new computer system to integrate the existing systems of Fuji Bank and Dai-Ichi Kangyo Bank.

“System integration is a huge ordeal, a mind-numbing effort,” Masayuki Oku, executive director of Sumitomo Mitsui Banking Corp., said at a news conference. “Getting things 99.9 percent is not good enough, and no mistakes are allowed.”

SMBC went through a partial integration of computer systems similar to what Mizuho is attempting.

In January, UFJ Bank, created through a merger of the former Sanwa and Tokai banks, saw its computer system erroneously deduct payments for purchases and services.

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