TOKYO (Reuters) – Japan Post Bank Co Ltd (7182.T) said on Friday it had improperly sold investment trust products to elderly customers in about 19,500 cases, the latest instance of misconduct at the state-backed postal and financial group before a planned share sale.
The bank said it discovered branches and post offices had neglected an internal rule requiring staff to confirm twice that customers aged 70 years or older were in good health and had a good grasp of its products before making any sales.
An investigation by the unit of Japan Post Holdings Co Ltd (6178.T) discovered 17,700 cases where products were improperly sold at its 213 branches and 1,891 cases at post offices in the year ending March, the bank said at a news briefing.
“The problem comes from staff, without giving it much thought, believing it’s not a big problem,” an official at the bank told reporters.
The misconduct casts a shadow over the government’s plan to sell $10 billion worth of its shares in Japan Post Holdings to pay for reconstruction in areas hit by the 2011 earthquake and tsunami.
Shares in Japan Post Holdings have dived about 15% since revelations in July of impropriety at another subsidiary, Japan Post Insurance Co Ltd (7181.T). Analysts have said the government may delay its share sale due to the price slide.
Japanese banks have struggled with years of near-zero interest rates and a dwindling population that have made the traditional lending business less profitable.
Given the nation’s relatively high savings rate and the number of wealthy individuals, Japan’s personal financial assets totaled 1,830 trillion yen ($17 trillion) at the end of 2018, according to the Bank of Japan.