The chairman of the Trust Companies Association of Japan said Thursday that a proposal under which certain banks would discontinue their retirement allowances to board members constitutes one option to counter the nation's financial problems.
The proposal, put forward by Financial Services Minister Hakuo Yanagisawa, would affect those banks that have accepted public funds in order to boost their capital bases.
Association chief Akio Utsumi told a news conference that the plan was "an issue to be considered," adding that the discontinuation of retirement allowances to directors is one option for banks struggling under the weight of huge bad loans and sharp falls in stock prices.
Yanagisawa issued the proposal for banks that accepted public funds in 1998 and 1999 under the government's bank recapitalization program, which is aimed at stabilizing Japan's shaky financial system.
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