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Statement by the Governor concerning Resona Bank

Some editorial revisions have been made to the English translation since it was initially released on May 17, 2003.
The original Japanese text, however, remains entirely unchanged.

May 17, 2003
Bank of Japan

1. Resona Bank informed us today that it did not meet the minimum capital requirement of 4.0 percent, which applies to domestic banks, as of end-March 2003.

The Financial Services Agency (FSA) also informed us that it issued prompt corrective action against Resona Bank.

Under these circumstances, the Prime Minister held a meeting of the Financial System Management Council and decided to inject public funds into Resona Bank pursuant to Article 102 of the Deposit Insurance Law as appropriate.

2. The Bank of Japan decided at today's Policy Board meeting to provide liquidity to Resona Bank, when necessary, upon the request from the Commissioner of the FSA and the Finance Minister pursuant to Article 38 of the Bank of Japan Law.

No liquidity problem at Resona Bank has been observed so far, and the Bank of Japan stands ready to ensure smooth funding by Resona Bank.

3. With these measures, Resona Bank will continue its normal operations, while strengthening its financial soundness.

The Bank of Japan, in close cooperation with the government, will continue to make utmost efforts to ensure the stability of Japan's financial system.