Mizuho Financial Group stung by report on lending to crime figures

Oct. 28, 2013 at 9:57 AM   |   0 comments

TOKYO, Oct. 28 (UPI) -- Japan's huge Mizuho Financial Group bank said 52 executives would have their pay cut after a report exposed $2 million in loans made to organized crime figures.

The BBC reported Monday the report was critical of the bank's response to the loans because senior executives knew about them three years ago and took "no substantial steps" to do anything about them.

The bank said the executives would have their pay reduced because of the scandal. It said Takashi Tsukamoto, chairman of its lending unit, Mizuho Bank, would forfeit six months of pay and step down from his position. The bank's president , Yasuhiro Sato, who was reportedly made aware of the problem two years ago, would also give up six months of pay, the Financial Times reported.

Taro Aso, Japan's financial services minister, said regulators would closely examine the report that was prepared by an independent panel of lawyers hired by the bank.

The regulator has already requested that the bank come up with a "workable and concrete policy to prevent any recurrence" of the lending practices called "outrageous" by Isshu Sugawara, head of the Treasury and Finance Committee of the ruling Liberal Democratic party.

The bank is the second largest in Japan and the 15th largest in the world if measured by total assets, the Financial Times said.

Topics: Taro Aso
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