Japanese postal privatization planning firm begins operations
Japan Post Corp., a new stock company set up by the public corporation Japan Post, began operations Monday in the buildup to Japan’s postal privatization from October 2007.
Japan Post Corp. will become a holding company on Oct. 1, 2007, the date when the nation’s postal services begin a step-by-step 10-year privatization process. The public corporation will be split into four units under the holding company.
The newly established firm will focus on plans to manage 260,000 employees and assets now controlled by Japan Post and study possible business models for the four operating companies.
Former Sumitomo Mitsui Banking Corp. President Yoshifumi Nishikawa was named president of the new company at an inaugural board meeting Friday. Former Financial Services Agency Commissioner Shokichi Takagi and Hiroaki Dan, senior executive vice president of Japan Post, were appointed directors.
The three executives will jointly select executives to run the four operating units.
At a news conference Monday, Nishikawa stressed the need for Japan Post to gradually change its ways of financing and investing with privatization in mind.
“The business model of procuring funds from fixed postal savings and investing them in government bonds will be no longer applicable,” Nishikawa said.
He also expressed the desire to start lending business as early as possible. But he added, “We will carefully consider such topics as when to begin or to what extent we should be engaged.”
The four operating units, which will be privatized over the period of 10 years, will be in charge of postal savings, postal insurance, mail delivery, and over-the-counter services at post offices across the country.
The new company will receive government funding for a certain period even after the privatization process begins, triggering concerns that it could squeeze private financial institutions in competing for new business.
The company started operations with 300 billion yen in capital put up by Japan Post, including a capital stock of 150 billion yen.
The government plans to gradually decrease its stake in the new company to just over one third after the process of privatization starts in October 2007.
While fully privatizing savings and insurance operations by 2017 by unloading all shares in the two units, the holding company will keep its shareholdings in the mail delivery and post office service units.
