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The Financial Services Agency on Wednesday ordered Mizuho Holdings Inc. to improve its operations in the wake of a massive computer system failure that left its operations in chaos.

The fiasco began to disrupt the megabank’s automated teller machines April 1 and continued for most of the month.

In a news conference held by Mizuho officials, the bank pledged to swiftly implement the series of steps ordered by the FSA to prevent a recurrence of similar accidents and regain public trust.

It promised to stabilize its computer system by bolstering system management and reducing the risk of system glitches.

The agency ordered Mizuho to report to the authority every three months on progress made in the plan’s implementation. Should trouble occur again, the banking group will be forced to reshuffle its top management, the FSA warned.

The agency said it is the first time for the financial regulator to issue such an administrative order to a major bank since its predecessor, the Financial Supervisory Agency, ordered the Bank of Tokyo-Mitsubishi to improve operations in April 1999 after it was found to have given clients inappropriate information regarding a financial product.

Mizuho’s system glitches were attributed to inadequate testing prior to the creation of Mizuho Bank and Mizuho Corporate Bank through a merger of Dai-Ichi Kangyo Bank, Fuji Bank and the Industrial Bank of Japan.

A nearly monthlong probe by financial authorities also showed that the bank lacked sufficient internal communication during testing, the result of bickering and infighting among the three merging units.

The Mizuho Bank unit experienced system glitches affecting its ATM network and settlement transactions following the integration, and at one point as many as 2.5 million automatic utility and credit card payment settlements were delayed. About 60,000 cases of duplicated withdrawals were also confirmed.

Incomplete settlements were resolved by the end of April, and no additional widespread problems have occurred since, according to Mizuho.

Separately, Chief Cabinet Secretary Yasuo Fukuda said the Mizuho fiasco is a kind of problem that should never happen at a financial institution.

“They made an extremely serious error,” he said. “I believe they will do their utmost to keep the problem from happening again.”

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