The new management team at Resona Holdings Inc. won’t know until October whether the banking group will be able to turn a profit in the current business year, new Resona Holdings Chairman Eiji Hosoya said Thursday.
“We have to see the results of a reassessment of assets, which is essential to regain market trust,” Hosoya told reporters. “Then we will be able to finalize our business plans.”
The delay illustrates the long road ahead of the nation’s fifth-largest banking group if it is ever to repay the unprecedented public funds injection pledged by the government July 1.
Resona’s bailout will be worth approximately 1.96 trillion yen.
The recent Diet testimony of auditor Asahi & Co., which said it had found the bank to be insolvent for fiscal 2002 following a preliminary audit, has spurred calls for a re-evaluation of the bank’s assets.
The new audit will not be conducted by Asahi & Co., which discontinued its audit, or by Shin Nihon & Co., which found the bank solvent but short of the necessary capital to meet regulatory requirements.
The second audit will not be completed until September at the earliest, according to Hosoya.
Prime Minister Junichiro Koizumi and Financial Services Minister Heizo Takenaka had termed the infusion of public funds “an injection into a sound bank.”
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