Pressure mounts on Mizuho President over loans to crime groups

Sunset in Tokyo, Japan

Pressure on Mizuho President Yasuhiro Sato mounted after Japan’s financial regulator told the bank to explain how and when top executives found out about its loans to crime groups.

Bloomberg reports that the Financial Services Agency issued the order yesterday after Mizuho said it erred in reporting only lower-ranking officials knew of the loans, an FSA official told reporters in Tokyo, asking not to be named in accordance with its policy.

The order, the first against the parent company about the matter, comes less than two weeks after the FSA told Mizuho’s banking unit to improve compliance for allowing members of crime groups to borrow money through a consumer credit affiliate. Sato said this week that he was unaware of the lending until the regulator’s investigation in March.

'The situation is clearly getting more negative', said Shinichiro Nakamura, a Tokyo-based analyst at SMBC Nikko Securities. 'The worst-case scenario that President Sato has to resign may come in sight'.

Satoru Nishibori, president of Mizuho’s banking unit at the time, knew of the loans in 2010, Sato said on 8th October, amending earlier statements by the bank that four senior compliance officials were aware and didn’t inform superiors.

To access the complete Bloomberg article hit the link below

Mizuho's Sato Under Pressure as FSA Scrutinizes Crime Loans

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