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Finance Minister Masajuro Shiokawa criticized the nation’s top banks Tuesday for planning to increase their capital through third-party stock allocations.

Shiokawa said banks need to turn to the public to strengthen their financial standing and must make efforts to encourage people to purchase their shares instead of allocating shares to particular companies, including their business partners.

The finance minister also said he does not agree with recent calls for the limit of the Bank of Japan’s stock buying operations to be increased to shore up the ailing stock market ahead of March 31, the end of the current financial year.

“The problem of the stock market is the banks’ lack of appeal to the public. Even if the BOJ makes efforts (to shore up stock prices), there is a limit,” Shiokawa said. “Why don’t banks persuade the public of the necessity for them to increase their capital?

“They’re trying to reinforce their capital more easily by telling certain companies (to buy their stocks),” he said.

Mizuho Holdings Inc. is tapping business clients in an effort to raise 850 billion yen by March 31. Resona Holdings Inc. plans to raise 100 billion yen by March 31.

The banks’ plans have so far failed to keep their stock prices from falling.

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