Three Japanese bank chiefs performed ritualized apologies before a parliamentary panel Friday for their banks’ roles in a web of scandals.
But their remarkably similar words rang hollow to some analysts who had hoped for fundamental changes.
The apologies were delivered before a special lower house panel investigating financial scandals borne out of Japan’s 1980s “bubble economy” of soaring stock and property markets.
“We deeply regret betraying the public trust in us,” said Yo Kurasawa, president of Industrial Bank of Japan Ltd.
“We deeply apologize for a series of scandals involving our bank,” said Fuji Bank Ltd. President Toru Hashimoto.
“I’d like to apologize for damaging public trust in Japan’s financial industry,” said Sotoo Tatsumi, president Sumitomo Bank Ltd.
The three banks are among the many financial institutions, including top brokerages, entangled in the scandals.
Nomura Securities Co. Ltd.'s ex-chairman, Setsuya Tabuchi, and Nikko Securities Co. Ltd.'s ex-chairman, Takuya Iwasaki, used similar words about their firms’ links to gangsters and other misdeeds in front of the same committee Thursday.
“It’s ritual repentance . . . I think they want to get away with self-criticism and promises never to do it again. It’s like a proxy for fundamental change,” said Jardine Fleming financial analyst Robert Zielinski, referring to the bankers’ apologies.
IBJ’s Kurosawa faced persistent questioning over why his bank lent massive amounts to an Osaka restaurant owner now under arrest on suspicion of using fraudulent documents to obtain the loans from IBJ and other financial institutions.
All he could do was admit that the bank’s system of checking customer credit had, in this case, proved inadequate.
“I deeply regret that we made abnormally large loans to an individual because we did not observe the necessary prudence,” Kurosawa said.
The IBJ group as of the end of October, 1990, had lent $1.75 billion (240 billion yen) to Nui Onoue, an Osaka restaurateur with a penchant for mystical religion and stock market speculation.
Most panel members appeared dissatisfied with Kurosawa’s replies. “I cannot understand and I am still puzzled why IBJ lent so much money to such a person,” said an opposition member.
Sumitomo’s Tatsumi and Fuji Bank’s Hashimoto both said the root of the scandals was relentless pursuit of profits. “It cannot be denied our excessive emphasis on profits made our men lose their sense of proper judgment,” said Tatsumi.