- Aug. 1, 2019
- Jul. 31, 2019
- Jul. 31, 2019
Bank of Japan
1. On September 12th, Hokkaido Takushoku Bank announced the postponement of its planned merger with Hokkaido Bank, previously scheduled for April 1998. On the same day, Hokkaido Takushoku Bank also announced a restructuring program including disposal of non-performing loans, raising of new capital and improvements in management efficiency. Although the bank tried to make efforts to realize this program, after the announcement of the postponement of the merger, it began to lose market confidence as was seen in the sharp decline in its stock price as well as in the drops in deposit levels. Furthermore, the cautious attitude of interbank market players have made it difficult for the bank to raise sufficient funds. Consequently, it has become impossible for the bank to fulfill its overall funding requirements.
2. Under such circumstances, we have been informed by Hokkaido Takushoku Bank of the following points.
3. In view of the fact that Hokkaido Takushoku Bank plays an important role in the Hokkaido economy and in order to maintain the stability of the Japanese financial system, the Bank of Japan believes it essential that the bank's financial function itself must be maintained by all means.
4. In this context, the Bank of Japan believes that a resolution package must be worked out by concerned parties, based on the result of the inspection presently being conducted by the Ministry of Finance on the bank's financial condition. The outline of the resolution scheme shall be the following.
5. The Bank of Japan will initiate discussions with concerned parties to swiftly finalize a resolution package and will provide full support towards its smooth implementation. Furthermore, the Bank of Japan will provide necessary liquidity for Hokkaido Takushoku Bank to continue business operations, based on Article 25 of the Bank of Japan Law, until the transfer of business is completed.
6. All deposits will be transferred to the receiving financial institutions and thus will be fully protected. We request depositors not to be concerned and to act sensibly.