A fresh injection of public funds would hamper, not help, Japan's banks, a banking official tapped to be the next president of the Mizuho Holdings Inc. banking group said Wednesday.
Speaking at a news conference, Terunobu Maeda brushed aside incessant concerns about the deterioration of capital at the nation's banks.
"I do not believe public involvement raises (banks') efficiency or that an injection of public funds would be beneficial," Maeda, who is expected to head Mizuho Holdings from April, said. "As for Mizuho, we do not need these funds."
The holding company joins Dai-Ichi Kangyo Bank, Fuji Bank and Industrial Bank of Japan to form the world's largest bank in terms of assets. In April, these three banks will be reborn as Mizuho Bank, which will amalgamate the three banks' retail banking divisions and the Mizuho Corporate Bank, the group's investment banking and corporate finance arm.
"Our strength lies in our vast number of clients and our assets," Maeda said. "The next step will be to increase the quality and size of our earnings.
Mizuho Bank will raise earnings partly by raising interest on its loans to better meet risk, said Tadashi Kudo, Mizuho Bank's president-to-be.
Mizuho Corporate Bank aims to have fee business comprise 50 percent of its operating profits by expanding investment banking operations with the groups' current clientele of some 23,000 companies, according to Hiroshi Saito, who is to preside over the bank.