Prime Minister Junichiro Koizumi and Financial Services Minister Hakuo Yanagisawa on Friday confirmed that the government will exclude checking accounts used for settlements from plans to limit government protection of bank deposits.
The confirmation came ahead of the Monday release of a report by a government advisory panel expected to call for introducing the new type of deposit.
It means that settlement accounts will continue being fully guaranteed after April 1, when the government puts a 10 million yen cap on refunds of interest-bearing deposits at banks that go bankrupt.
The working group of the Financial System Council “is set to draw up a report (Monday), so I briefed (Koizumi) on its progress,” Yanagisawa told reporters after the meeting at the prime minister’s office. “The prime minister said, ‘I want you to proceed based on discussions (by the panel).’ “
Last April 1, the government imposed a cap of 10 million yen per bank per depositor on time deposits it will reimburse under its deposit insurance system in the event of a bank failure.
The government had initially planned to impose a similar cap on all types of deposits this coming April 1.
Calls are growing among ruling bloc lawmakers to postpone the plan to impose the cap altogether, saying the plan to exclude deposits for settlements cannot win public approval.
Yanagisawa also said at a news conference he hopes the proposed new settlement account will be introduced at financial institutions simultaneously “to give depositors as much chance as possible to use it.”
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