New Year’s Message

　As we celebrate the start of 2024, I would like to share my thoughts on the past year and what lies ahead.
　First of all, I would like to express my deepest sympathies to all those who were affected by the 2024 Noto Peninsula Earthquake. I would also like to express my deepest condolences to the victims and offer my sincere sympathies to the bereaved families. The banking industry will do its utmost to support the recovery and reconstruction efforts, including financial measures to deal with the earthquake and applying the Guidelines for Debt Consolidation for Victims of Natural Disasters, so that the affected areas can be recovered as soon as possible and the affected people can resume their normal lives.
　Looking back on 2023, the outlook remained uncertain, with financial system instability triggered by the failures of the US regional banks, concerns that inflation and monetary tightening in Europe and the US would lead to a hard landing of the economy, and growing tensions in the Middle East amid protracted Russia’s invasion of Ukraine. Advances in IT technology, change in people's behaviours and the growing complexity of the economy, have made the future predictions difficult. Under these circumstances, governments and financial authorities in various countries faced challenging decisions. Nevertheless, the global economy remained generally resilient. In Japan, since the classification of COVID-19 under the act on prevention of infectious diseases was downgraded in May last year, the pre-COVID activities has gradually returned, including a recovery in the number of tourists visiting Japan. Additionally, while the Bank of Japan forecasts a high level of +2.8% year-on-year for the Consumer Price Index (excluding fresh food) in the fiscal year 2023, the spring wage increase rate has also reached a 30-year high at +3.6%. These are proof that the "virtuous circle of growth and distribution" is definitely starting to work, and the year of 2023 was a “year that showed signs of change” for the Japanese economy after a long period of zero inflation.
　In this environment, the Japanese Bankers Association (JBA) has envisioned fiscal year 2023 as "a year for supporting sustainable social and economic development for a brighter future", and has been advancing its activities with the following three key pillars.
　About the first pillar - "contributing to sustainable economic growth and resolution of social issues". Regarding start-up support, as we agreed at the Board of Directors meeting held in January 2023, each bank is working to improve its expertise in business viability assessment and diversify its funding methods. In the area of support for small and medium-sized enterprises (SMEs), we have been revising various guidelines on management guarantees and business revitalization to further promote early business revitalization. We will continue to fully support the challenges of motivated business owners and make every effort to stimulate the industries. As part of the “shift from savings to investment,” the new NISA has started in this January, and we have been focusing on various forms of promotion and public relations activities. We will broaden the scope of asset building in Japan and contribute to the realization of a "virtuous circle of growth and distribution" with the new NISA. Furthermore, in this fiscal year, to promote financial and economic education including support for asset building, we have initiated the dispatch of lecturers to not only to schools, but also to workplaces. We will participate in the new financial and economic education promotion organization which will be established in fiscal year 2024, and contribute to the promotion of financial and economic education together with the public and private sectors. In addition, we have disseminated information on the promotion of transitions towards the realization of a decarbonized society through organizing and participating in international conferences. As the framework for non-financial information disclosure is being developed, we are also actively involved in discussions to standardize the disclosure, considering SMEs.
　About the second pillar - “establishment of a safe, stable and efficient financial infrastructure through development of digital technology”. As a countermeasure to the labour shortage, the full digitalization of the bill and check function is expected to improve operational efficiency and productivity in society. In these circumstances, we have delivered lectures nationwide, to foster understanding among users. At the same time, we are providing multifaceted support to financial institutions, such as holding seminars for financial institutions and creating advertising media to be printed in bill and check books which will be distributed to a wide range of financial institutions. Moreover, in April last year, QR payment started for certain local taxes, such as automobile tax and fixed asset tax, making it possible to pay by smartphone anytime and anywhere. In the coming fiscal year, all local taxes will be covered by QR payment. In the area of cybersecurity, from the perspective of mutual aid, we are sharing good practices that contribute to autonomous measures of individual banks.
　The failure of the Zengin System operated by the Japanese Banks' Payment Clearing Network (Zengin-Net) in October last year, caused considerable inconvenience to customers. Coincidentally, last year also marked the 50th anniversary of the operation of this system. Through improvements of operations and prevention of recurrence, the banking industry will continue to work together with Zengin-Net to ensure safety and security, while enhancing convenience.
　About the third pillar -"enhancement of a sound and resilient financial system". To eliminate money laundering and unauthorized use of deposit accounts, we are carrying out awareness and publicity activities for continuous customer management through various media, and asking for the submission of the latest customer information. In addition, the services of "Cooperation agency for Anti-Money Laundering" will begin in April this year. The first service will start with a business enhancement support service, including practical guidance and training, followed by an AI scoring service in April next year. Anti-Money Laundering is one of the most important challenges related to an international consensus and Japan's economic activities. The banking industry is commited to enhance its response capabilities. Moreover, it is expected that the Euroyen TIBOR will be permanently ceased in December this year. We will work with customers to prepare for a smooth transition from transactions referencing this benchmark.
　This year, we expect that the world continues to face a high degree of uncertainty amid increasing global complexity, such as the monetary policy in various countries, tackling the climate change, and the radicalized global conflict structure. Against this backdrop, Japan is at a stage where it is expected to completely overcome its prolonged deflation.
　In order for our country to get on a new growth trajectory, the banking industry will support the corporate investment activities from financial and growth strategy perspective, as well as the asset building and consumption activities of individuals, thereby contributing to the realization of a virtuous economic cycle and the sustainable development of society.