A series of system failures that hit Japanese megabank Mizuho Bank earlier this year, including many of its automated teller machines, were due to poor operation and management rather than system defects, a third-party panel concluded Tuesday.
The panel consisting of lawyers and system management experts said in a report that human errors such as in the placement of technology-related staff and the company culture of hesitating to speak up during contingencies to avoid liability issues caused the problem.
No common system defects were found in the four failures that occurred in about two weeks from Feb. 28, when over 4,300, or about 80 percent, of Mizuho's ATMs operating nationwide were temporarily suspended and more than 5,000 bank cards and books were stuck inside them, the report said.
Mizuho Financial Group Inc. is expected to announce its response to the panel's conclusion at a press conference later in the day.
Prior to the first breakdown in February, when most of the bank cards and books became unreturnable, the report said the bank failed to identify the risk of running out of memory in the system as personnel rotation had prevented staff knowledgeable about the system from being involved closely in its operation.
On Feb. 28, its systems were overwhelmed when updating the status of fixed deposit accounts and processing other transactions.
The panel also said that Mizuho, one of Japan's top three commercial banks, lacked consideration for its customers as it took only a reactive approach in the wake of ATM failures and forced many users to wait on site without any information.
In order to prevent any recurrences, the report said appointing outside personnel can help in changing the corporate culture. Mizuho Financial Group plans to recruit executives from technology companies such as IBM Japan Ltd. to oversee the system management, sources familiar with the matter said.
To take responsibility for the failures, Mizuho Bank President Koji Fujiwara is considering quitting and not assuming the post of bank chairman, the sources said earlier.
The Financial Services Agency plans to issue a business improvement order against Mizuho, according to the sources.