Mizuho Financial Group CEO Tatsufumi Sakai and three other senior exectives will resign after the bank has been reprimanded by the Japans’ banking regulator over technical system failures.
Financial Services Agency (FSA) of Japan issued a business improvement order on the bank in connection with the system glitches, highlighting its defect in governance and corporate culture.
In addition to Sakai, other executives in charge of the group’s systems and compliance will step down in April to take responsibility for the system outages and regulatory actions.
Those leaving the bank include Mizuho Bank CEO Koji Fujiwara, bank’s IT head Satoshi Ishii, and chairman Yasuhiro Sato.
The bank said that accelerate its efforts to select a successor to the president and Group CEO while Fujiwara will be replaced by Masahiko Kato.
System glitches and FSA findings
Mizuho has been troubled with serious IT issues since it was founded by combining three banks over two decades ago.
The bank was given business improvement orders from the regulator following system failures in 2002 and 2011.
Despite a $3.6bn revamp of its systems in 2019, the Japanese lender experienced eight system glitches so far this year.
This involves a hardware failure incident in March, leading to a delay in 300 foreign-currency money transfers.
FSA, which has been probing Mizuho to find the root causes for system issues, criticised the lender for its lack of awareness for the impact on its clients.
The regulator also said that did not pay enough attention or consideration to client facing businesses.
Responding to administrative action by FCA, Mizuho said in a statement: “As a financial institution bearing responsibility for maintaining societal infrastructure, we deeply apologise for the inconvenience and concern we have caused to our customers and society by allowing these system failures to occur repeatedly in a short period of time and, as a consequence, failing to adequately fulfill our role in facilitating smooth settlements and failing to adequately ensure thorough operations under the Foreign Exchange and Foreign Trade Act of Japan.”