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The president of Mizuho Holdings Inc. admitted Wednesday that more thorough tests before the integration of the banking group’s computer systems would have helped prevent the glitches that are now threatening to delay month-end salary payments and holiday transactions.

“I have to say that preliminary tests were inadequate,” Terunobu Maeda said during testimony before the Lower House Committee on Financial Affairs, attended by the presidents of the nation’s three other major banking groups: Sumitomo Mitsui Banking Corp., Bank of Tokyo-Mitsubishi and UFJ Bank.

“We are still working on fully resolving the mistakes made at the beginning of the month,” he said. “We are not in a condition to grasp information on the cost of the damages” to the bank.

System glitches have affected the automatic teller machine network and settlement transactions of Mizuho Holdings’ Mizuho Bank since April 1. The problems have delayed 2.5 million automatic utility and credit card payment settlements and caused 60,000 customers to be double-billed.

Although the bank had processed most of the incomplete transactions by last week, regulators and analysts fear the world’s largest banking group will suffer further delays on Thursday, when employee wages and corporate money transfers need to be processed, and again on April 30, when many people are expected to withdraw money via ATMs ahead of the Golden Week holiday season.

Although regulators and analysts harbor some concern over the possibility that today’s deluge of transfers could once again overburden the system, Mizuho officials have expressed confidence.

They reason that most of Thursday’s transfers will be initiated by corporate customers — a path that has remained relatively free of problems; the glitches have been coming when retail customers try to move their money.

Mizuho officials, however, have not been as upbeat regarding next week’s tsunami, which is expected to bring twice as money transactions as today.

“We expect 9 million bank transfers and 3 million salary payments, totaling 12 million transactions in a single day,” Maeda said, referring to the transaction volume expected on April 30. “We are doing our utmost to deal with that.

“I apologize for the inconvenience that we have caused,” he continued, repeating the apology each time he was asked to testify on the computer problems.

Concerning the overall banking sector’s piles of bad debt, Yoshifumi Nishikawa, president of Sumitomo Mitsui Banking Corp., said they will remain at a high level for the next couple of years.

“We have disposed of the bad debts that came from excessive lending based on inflated land price assessments,” Nishikawa said. “But there still remain concentrated risks in a small number of large borrowers — a legacy of banks’ neglect of some of the basic principles of risk management.”

Said Shigemitsu Miki, president of Bank of Tokyo-Mitsubishi: “We have written off bad loans to our largest borrowers made during the asset-inflated bubble economy but we cannot let our guard down against new bad debts.

“Much hinges on the strength of the economy.”

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