Mizuho Financial Group head likely to quit over repeated glitches

© Kyodo News

Tatsufumi Sakai, president and CEO of Mizuho Financial Group Inc., is likely to step down as financial regulators aim to punish the company for its sloppy handling of repeated glitches at its core banking unit, sources familiar with the matter said Thursday.

The Financial Services Agency is planning to slap Mizuho Financial Group and Mizuho Bank with administrative sanctions, requesting business improvement measures, possibly within this month, while the Finance Ministry is considering ordering a review of the bank's operations over suspected violation of the Foreign Exchange and Foreign Trade Control Law in September, the sources said.

Mizuho Financial Group, one of Japan's major banking groups, aims to recover public trust by management taking responsibility through Sakai's resignation, according to the sources.

Mizuho Bank experienced system glitches eight times this year, affecting automated teller machines and causing other problems.

Regarding the Sept. 30 system glitch, which caused delays in some of its money transfers for foreign exchange trades, the Finance Ministry believes Mizuho Bank failed to take necessary steps to prevent money laundering before foreign currency remittances, the sources said.

The Financial Services Agency is expected to notify Mizuho Bank of its findings in the near future, following the investigation of the series of system issues.

Although Mizuho Bank drew up preventive measures in June after experiencing four system glitches, the bank has since been hit by such problems an additional four times.