Mizuho Financial Group Inc.’s newly chairwoman says she wants to be receptive to the opinions of those running its frontline operations to boost the lender’s oversight structure in the wake of last year’s yakuza loan scandal.
Hiroko Ota, who got the shareholders’ nod to lead the mega-bank’s board of directors last week, said she is looking to drastically move decision-making power to the executive level in exchange for letting the board focus on monitoring business execution.
“We will need to bring information (at the operational level) up to the board” to oversee the bank’s management appropriately, Ota said in a recent interview.
The board of external directors should also be powerful enough to dismiss the president, she added.
The nation’s third-largest banking group by market capitalization tapped the former economic and fiscal policy minister as chairwoman to strengthen corporate governance after the bank was found handing auto loans to the yakuza for more than two years, in September 2013.
Mizuho also set up three oversight panels — the first major bank to do so — to nominate executives, set their pay and conduct audits.
The banking giant, created in 2002 by the three-way merger of Dai-ichi Kangyo Bank, Fuji Bank and Industrial Bank of Japan, was also hit by a massive computer breakdown in 2011.
Ota blamed the problems on a failure to share critical information in a timely way throughout the bank, which she said has yet to maximize the merger’s synergies.