Suruga Bank Chm. Okano to Step Down over Loan Scandals

August 28, 2018

Tokyo- Suruga Bank Chairman Mitsuyoshi Okano is expected to step down to take the blame for document tampering and other irregularities at the bank over loans related to real estate for investment, including share houses, it was learned Monday.

Okano, 73, a member of the founding family of the regional bank based in the city of Numazu, Shizuoka Prefecture, central Japan, had served as president of the lender for about 30 years.

The Financial Services Agency, which is conducting an on-site inspection of Suruga Bank, believes that the bank's management bears a heavy responsibility for having been unable to prevent the irregularities as its governance system has failed to work, informed sources said.

An independent panel of lawyers established by Suruga Bank is set to release a report on its investigation of the scandals within this month.

The balance of the bank's loans provided for share house-related investment stands at about 200 billion yen, according to the lender.

Suruga Bank has been found to have manipulated documents on the screenings of applications for loans related to investment in real estate items, including share houses and apartments.

Okano became Suruga Bank president in 1985. Even after stepping aside to the post of chairman in 2016, he has been exerting his influence on the bank's management by keeping his right to represent the lender.

On the Tokyo Stock Exchange's first section, the stock of Suruga Bank ended at 607 yen on Monday, down by more than 70 pct compared with its levels above 2,500 yen early this year.

Suruga Bank has suggested the possibility of lowering its earnings estimates for fiscal 2018, which ends next March, as it is in the process of assessing if more loans will become irrecoverable. The bank currently puts its fiscal 2018 group net profit at 25 billion yen. Jiji Press