Business / Corporate

FSA plans more action against Mizuho

Kyodo

The Financial Services Agency will soon take additional punitive action against Mizuho Bank doing business with organized crime, FSA sources said Friday.

The financial watchdog first ordered the bank in September to improve operations, saying it did not take “substantial steps” to prevent or break off transactions with “antisocial forces” for more than two years despite knowing about the matter.

This time, the FSA is considering issuing the business improvement order to its parent Mizuho Financial Group Inc. as well, since the holding company failed to fulfill its responsibility to oversee the bank, the sources said.

The Mizuho group will thus need to improve its management system again.

After receiving the order, Mizuho Bank initially said top management was not informed of the gangster loans but later reversed itself, with President Yasuhiro Sato telling a press conference that he and former President Satoru Nishibori “were in positions to know” about the issue.

While a third-party investigative committee — set up by the bank — concluded it had no intention of covering up the loan problem when it submitted a false report on the issue to the FSA, the agency decided on Nov. 5 to inspect Mizuho Bank and Mizuho Financial Group to examine their conclusions.

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