Press Conference by the Minister for Financial Services

(Excerpt)

8 October, 2002

Q.

In a magazine interview, you stated you would not employ the idea that large companies or major banks are too big to fail. As there is a lot of speculation in the market in regard to this, could you please explain once again what you meant by that?

A.

As you just mentioned, in a magazine interview, I did state that it is not appropriate to employ the ''too big to fail'' assumption in general terms, not as a matter of any specific banks or any specific companies. Although some media have reported that I was talking about the consolidation of major banks based on this interview. They cause huge misunderstanding and the way in which they report may generate turmoil in the market. I have not made any decisions yet; I just started to engage in discussions eagerly in the Project Team in order to decide what to do, and I have not said anything specific as such. As I am extremely mindful about refraining from discussions that intentionally and simply associate a general idea with a policy decision, and your cooperation will be highly appreciated in this regard.

Q.

Do the current stock prices have an impact on financial institutions? Also, are measures against stock prices feasible as an option? Please elaborate on these matters.

A.

The impact of stock prices can be discussed in various ways, assuming various timings and impacts. However, I personally believe the Japanese economy has an extremely strong potential, and I am confident that the implementation of policies that we are seeking would push up the stock prices to a considerable degree. From my point of view, the current stock prices are in the preparation stage for making a leap forward.

Therefore, it is not so easy to say as to how the daily fluctuations affect financial institutions. I'd rather work hard to set up a situation in which Japan's stock prices would rise to the proper level, by firmly crystallizing the policies to be implemented, serving the Japanese people and the market to gain a proper understanding and making the Japanese economy demonstrate its potential abilities.