UFJ Bank President Masashi Teranishi denied Wednesday that the bank covered up the financial health of borrowers before the government launched probes into the major banking group.
“There is no fact that we intentionally concealed or tore up documents,” Teranishi told the House of Representatives Financial Affairs Committee.
Teranishi was speaking about allegations that UFJ Bank concealed a large volume of documents showing that borrowers were worse off than the assessments in the official papers it submitted to the Financial Services Agency.
According to news reports, FSA inspectors found the documents during a special inspection last fall.
Teranishi was summoned for unsworn testimony with the presidents of three other major banking groups.
“The documents concern business plans, balance sheets and debt situations for some of our customers, and I think they are memorandums or notes created personally by our staff in charge,” Teranishi said, stressing that the bank has been cooperating with the FSA in its probe.
“We have never been on a collision course emotionally with financial authorities and any of the inspectors,” he said. “We have never asked for a change in inspection staff.”
Also appearing before the committee, Sumitomo Mitsui Banking Corp. President Yoshifumi Nishikawa said he is confident his bank will reduce the ratio of bad loans to overall outstanding loans to slightly more than 3 percent by the end of next March.
Under the financial revitalization program launched in October 2002, the government wants big banks to halve that ratio to about 4 percent by March 2005 from the October 2002 level of about 8 percent.
Terunobu Maeda, president of Mizuho Financial Group Inc., said that to avoid a repeat of the types of problems that occurred last year, his group is now conducting tests for an integrated computer system scheduled to begin operations this summer.
The integration of the group’s computer systems connecting the network of its predecessors stalled on several occasions in 2002.