Banks don't want it. Most depositors don't need it. Many politicians oppose it. A compromise plan financial regulators are preparing is supposed to appease critics, help save the nation's weakest banks, and protect one of the key reform pledges of Prime Minister Junichiro Koizumi. It may accomplish none of these objectives.
A project team reporting to Koizumi on Monday urged financial institutions to create accounts that will be fully protected after April, when the state removes its guarantee on ordinary accounts in amounts in excess of 10 million plus interest per depositor.
So long as the accounts earn zero interest, down from about 0.001 percent, accounts will be fully protected by the government, the project team said.