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FSA orders Mizuho Bank to suspend tie-up loans

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(Globalpost/GlobalPost)

The Financial Services Agency said Thursday it has ordered Mizuho Bank to suspend some of its affiliated loans for a month over the lender's involvement in transactions with members of organized crime groups.

The financial watchdog also ordered the bank's parent Mizuho Financial Group Inc. to improve its business as it failed to fulfill its responsibility for management over the bank.

The latest orders followed one issued to Mizuho Bank in September to improve operations after it failed to take substantial steps to prevent or sever ties with "antisocial forces" for over two years despite its knowledge of the matter.

The FSA decided to take additional punitive action against the holding firm after determining that it was responsible for failing to prevent the bank from submitting a false report to the agency.

Mizuho Bank originally claimed its top management had not been aware of the issue, but it later admitted that President Yasuhiro Sato and former president Satoru Nishibori were in position to know.

A third-party panel set up by the bank concluded after a probe that the bank had no intention of concealing the loan problem when it submitted a false report to the FSA.

The agency launched additional inspections on Nov. 5 of Mizuho Bank and Mizuho Financial Group to verify the panel's findings.

==Kyodo

http://www.globalpost.com/dispatch/news/kyodo-news-international/131226/fsa-orders-mizuho-bank-suspend-tie-loans