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The Mizuho Financial Group has worked out a restructuring program, which includes an average salary cut of more than 10 percent from fiscal 2003, sources close to the program said Sunday.

The program also includes an early-retirement plan for middle-aged workers.

The Mizuho group, one of Japan’s four largest banking groups, will announce the measures Monday with the release of its financial statement for the April-September first half of fiscal 2002, the sources said.

Although the group is believed to have secured a net profit in the six-month period, it has drawn up the new restructuring program to cut personnel and other costs further. It also anticipates an increase in bad loans due to the government’s banking-reform policy.

Operating costs swelled significantly at the Mizuho group in the wake of the April 1 launch of Mizuho Bank and Mizuho Corporate Bank under Mizuho Holdings Inc.

The Mizuho group has already announced a plan to reduce its workforce at the two banks and the holding company from 30,000 at the end of March 2002 to 25,000 four years later.

The new restructuring program moves that date up one or two years and increases by several thousand the number of workers to be cut.

Employees aged 45 or older will be eligible for the early-retirement plan, which offers a better severance package, the sources said. The group expects several hundred workers to apply for the plan.

The restructuring program also includes additional cuts in bonus payments to regular workers, a reduction in the number of executives from the current 90 and a cut in executives’ pay, the sources said.

Redundant outlets will be scrapped or integrated into others, according to the sources. Among Japan’s major banks, Asahi Bank reduced employees’ pay by an average of 10 percent in 1998, and other banks have introduced de facto pay cuts after mergers. As a result, Mizuho’s pay scale had become relatively high, the sources said.

In addition to strengthening Mizuho’s financial base, the restructuring program is also seen as an effort by the Mizuho group to silence criticism from corporate clients that its pay levels are too high.

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