The government unveiled a draft bill Monday to review the postal privatization process, proposing a realignment of the Japan Post group into three companies from the current five.
The draft calls for a merger of postal service businesses to provide nationwide uniform financial services, particularly savings and insurance.
The components that would merge would be Japan Post Holdings Co., the holding company of the group, mail and parcel delivery unit Japan Post Service Co. and post office operator Japan Post Network Co.
Japan Post Bank Co. and Japan Post Insurance Co. would operate under the wing of the merged company.
The Democratic Party of Japan-led government has been pushing for a rethink of the postal privatization process spearheaded by Prime Minister Junichiro Koizumi of the Liberal Democratic Party.
The realignment proposal was prompted by worries that Japan Post Service may not be able to stay afloat, given the weak business environment surrounding its mail and parcel delivery services. Japan Post Bank and Japan Post Insurance generate the bulk of the group’s profits.
The draft would authorize the Japan Post group to start new businesses, including medical insurance and loans to smaller companies.
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