The government will order regional lender Suruga Bank to suspend some of its operations, possibly as soon as this week, as punishment for a series of improper share house loans, according to sources close to the matter.
The Financial Services Agency will suspend the bank's real estate financing operations for several months as a result of the findings by a third-party committee of lawyers released in September that management were involved in forgeries of loan screening documents, the sources said.
Having conducted on-site inspections since spring, the agency has also found that the bank had serious flaws in corporate governance.