TOKYO, Feb 8 (Reuters) - Mizuho Financial Group Inc , Japan’s No.2 lender by assets, said on Friday its CEO, Yasuhiro Sato, will also head a core banking unit to be created by a merger of Mizuho’s two banks in July.
The move was widely expected as Sato, 60, already serves as CEO of one of the banks, Mizuho Corporate Bank, but the question is how it will help boost Sato’s hand in steering the banking group with $1.8 trillion in assets, which has been plagued with two large-scale system failures and criticised of its bloated structure.
“Major challenges for Mizuho are making the whole organisation more efficient. The biggest challenge is to reduce the number of managers. They have too many cooks,” said Graeme Knowd, a banking analyst at Moody’s Japan.
Mizuho Financial is scheduled to merge its international and corporate banking unit, Mizuho Corporate Bank, and its retail and SME banking unit, Mizuho Bank, in July.
Mizuho’s announcement on Friday was limited to top posts at the bank and its group companies. It said the rest of a management shuffle will be released later and it remains to be seen how lean its management will become.
Sato, who became CEO of Mizuho Financial in 2011 following a massive system failure earlier in the year, has been working to make the banking group nimbler and more cost efficient as Japanese banks suffer weak loan demand at home.
Mizuho was created in 2000 by a merger of three rival banks. Its structure as a bank holding company with two core banking units has long been criticised as a compromise among the three banks to share management positions and seen as symbol of its inefficient operations.
($1 = 93.2100 Japanese yen)
Reporting by Taiga Uranaka