EVOLUTION OF CORPORATE GOVERNANCE OF BANKS IN JAPAN: SOME LESSONS FOR OTHER COUNTRIES

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Mitsuru Mizuno

https://doi.org/10.22495/cocv8si1p1

Abstract

This paper describes the evolution of corporate governance of banks in Japan. Banks had no serious problems and governance of banks was not paid so much attention until the banking crisis in the 1990s due mainly to the strict regulation by the government. However, it became apparent that non-performing loans had something to do with the governance of banks. The stakeholders of banks are different from those of non-financial institutions: the regulators and depositors play an important role as monitors of banks. The stakeholders as well as the banks’ themselves have undertaken to enhance the governance system in order to increase accountability and transparency. In this process, competitive banking sector, adequate banking regulation, and deposit insurance with limited amount of depositor’s protection system have become essential in strengthening the governance mechanism of banks.

Keywords: Corporate Governance of Banks, Stakeholder of Banks, Bank Regulation, Banking Crisis, Deposit Insurance

How to cite this paper: Mizuno, M. (2011). Evolution of corporate governance of banks in Japan: Some lessons for other countries [Special issue]. Corporate Ownership & Control, 8(2-1), 6-13. https://doi.org/10.22495/cocv8si1p1