U.S. Markets closed

Three Japan Post Group Presidents to Resign Friday, JNN Says

Shoko Oda and Max Zimmerman
1 / 2

Three Japan Post Group Presidents to Resign Friday, JNN Says

(Bloomberg) -- The presidents of three Japan Post Group companies will step down on Friday amid a scandal involving insurance sales, local broadcaster JNN reported.

The report said that the executives would step down at a press briefing on Friday, amid the ongoing scandal involving Japan Post insurance sales. Japan Post said that it is unaware of any plans by the officials to resign.

The report named Japan Post Holdings President Masatsugu Nagato, Japan Post Co. President Kunio Yokoyama and Japan Post Insurance Co. President Mitsuhiko Uehira as set to resign. Former Internal Affairs & Communications Minister Hiroya Masuda was expected to be named Japan Post Holdings president, while the other two posts would likely be filled by internal candidates, according to JNN.

Japan Post said in a statement that it isn’t true that unit presidents have indicated their intention to resign at this point. The holding company’s shares were down 0.5% in early afternoon trading Wednesday, taking its year-to-date decline to 20%. Japan Post Insurance dipped 1%, headed for a 28% tumble this year.

The report of management change comes amid allegations that Japan Post group employees cheated policy holders because of pressure to meet sales targets. A third-party probe last week found 12,836 cases where customers said they were subjected to problematic insurance sales practices.

The incident has also forced the government to consider holding off its plan to sell $10 billion worth of shares in Japan Post Holdings, according to people familiar with the situation.

When asked about his possible resignation, Nagato told a press conference last week he would announce his decision at an “appropriate time”.

The third-party panel report painted a damning picture of Japan Post’s work culture, in which employees were chastised in front of colleagues for poor performance. The scandal has shocked the Japanese public, especially in rural areas, where many people rely on the nation’s 24,000 post offices for financial services as well as mail delivery.

Nagato, a former Mizuho Bank senior executive, became CEO of Japan Post Holdings in April 2016 after his predecessor was hospitalized. Masuda started his career as a central government bureaucrat and served as governor of Iwate Prefecture. He was also chairman of a government panel overseeing Japan Post’s privatization process during 2013-2016.

(Updates with company denial of JNN report)

--With assistance from Taiga Uranaka and Yuki Hagiwara.

To contact the reporters on this story: Shoko Oda in Tokyo at soda13@bloomberg.net;Max Zimmerman in Tokyo at mzimmerman90@bloomberg.net

To contact the editors responsible for this story: Kazunori Takada at ktakada17@bloomberg.net, Kurt Schussler, Naoto Hosoda

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.