Realizing the "New Frontier" of Finance
Looking ahead at the next 10 years, we will aim to contribute to the recovery and ongoing growth of the Japanese economy, and growth in Asia and its associated effects on Japan's economic development. To this end, in April 2013, we have newly formed four project teams, namely: "Next–generation Retail Service," "Next–generation Industry Development," "Next–generation Asia–related Business," and "Invigoration of Domestic Financial Assets," thus, implementing consideration and initiatives for the realization of the "new frontier" of finance.
Developing Next–generation Industries
What Mizuho Aims to Be
Assuming the changes in Japan's industrial structure over the next ten years, we will endeavor to contribute to Mizuho's growth strategy by nurturing "new industries that will be necessary" and "industries that have growth potential," with a view especially to restructuring and sustainable development of the Japanese economy.
Based on the discussion of the Japanese government's Industrial Competitiveness Council, Mizuho's Next–Generation Industry Development PT (Project Team) has selected three focus fields—"environment and energy," "agriculture," and "medical care and silver industries"—and established individual teams to focus on each field. These teams progressively deepened their studies and took measures to address individual issues. Also, we have adopted a 10–year perspective on industry development and are striving to identify additional development themes based on analyses of Mizuho's expertise and its customers' needs in the aggregate as well as by drawing on the know–how of external organizations and specialists.
These initiatives have generated concrete results in such forms as the establishment of funds and arrangement of advisory contracts focused on industry development. They are contributing to foster next–generation industries while also promoting the expansion of Mizuho's business operations.
Providing Next–Generation Retail Services
What Mizuho Aims to Be
The progress of IT and expansion of social media has been accompanied by a diversification of communications methods, expanded use of electronic settlement methods in individuals' day–to–day lives, and other trends that are propelling noteworthy progress in financial technologies. Amid this situation, Mizuho is employing leading–edge technologies as it seeks to maintain close relationships with its customers and provide them with services characterized by ever higher levels of convenience and amenity.
In fiscal 2013, we established "Next–generation Retail PT" comprised of mainly young employees across several divisions to envisage financial services in the future. In April 2014, we also established the Incubation Department. While aggregating expertise, technologies, and other resources from within and outside the Group, the PT has worked to gain a deeper understanding of customer needs and move ahead with efforts to develop new services.
In fiscal 2014, we introduced new call center systems that incorporate Watson* speech recognition technology, and these systems have made it possible to provide responses with even greater speed and accuracy. Moreover, we have inaugurated a new service through a system that undertakes real–time analysis of the situations of customers accessing MHBK's website and offers effective chat–based advice when the system determines that customers are experiencing difficulties.
- Introduced combined service of Speech Recognition system and IBM Watson Technology at call centers
- *Watson Technology is IBM's cognitive computing technology (computer technology aiming to emulate human cognitive capabilities).
Developing Business in Asia
What Mizuho Aims to Be
Mizuho positions Asia as an extremely important region due to the excellent prospects for ongoing economic growth. To respond to the strong demand for funds that will be needed along with the high growth and increases in infrastructure investments in Asia, we are taking initiatives to create and build new businesses in Asia by drawing on our accmulated know–how regarding financial markets and financial services.
The Next–generation Asia Business PT is engaged in efforts centered on the Asia Bond Market Development Project. Besides private–sector–level efforts to promote bond market development through mutual cooperation with Asian financial institutions, the PT is realizing bond issuances based on the ASEAN+3 Multi–Cur rency Bond Issuance Framework (AMBIF) that are contributing to the additional development of bond markets in the Asia region.
In April 2015, we acquired regulatory approval from the Ministry of Finance of Thailand to issue THB–denominated bonds in the Thai domestic market (up to THB3.2 billion) under the AMBIF. Accordingly, we have commenced specific preparation work toward issuance. This will be the first issuance of bonds under the AMBIF.
Invigorating Domestic Financial Assets
What Mizuho Aims to Be
Amid the economic environment shift from deflation to inflation, maintaining and expanding households' financial assets requires more than investments in such safe assets as savings accounts and government bonds. It is becoming increasingly important for individuals to equip themselves with adequate levels of financial literacy so that they can select the most appropriate financial products.
Mizuho has established a project team to invigorate Japan's approximately JPY 1,700 trillion in monetary assets. Through measures including those to provide services in line with changes in the environment, the project team is moving ahead with efforts to realize fund flows that enable growth in household assets and also promote the growth of Japan's economy.
Noting that a high share of Japan's households' financial assets are held by seniors and that those assets are generally fixed in forms centered on savings accounts, the Domestic Financial Asset Invigoration PT studied cases of financial asset invigoration in other developed countries. We are at an appropriate stage for considering concerted public– and private–sector efforts over the long term centered on medium– to long–term investments as well as on defined contribution pension systems, NISAs*, and others. As a financial institution with such assets as channels, consulting capabilities, and an array of financial product, Mizuho is working based on a long–term perspective to act as a leader in the financial industry and contribute to the invigoration of domestic financial assets by implementing diverse measures.
Specifically, for the retired generation, we are promoting the provision of consulting services that not only respond to asset management needs emphasizing short–term gains but also promote medium– to long–term asset accumulation– and maintenance–related objectives in light of the trends of rising inflation and increasingly long lifespans. For working age households, we are making government policy recommendations and taking other initiatives to promote the use of long–term and fund–based asset formation methods and encourage greater diffusion of defined contribution pension and NISA systems.
- *NISA:Nippon Individual Savings Accounts
- Financial assets held by households (comparison of Japan and U.S., as of December 2014)
- *"Others" is the residual which is the remaining after deducting "Currency and deposits," "Insurance and pension reserves," "Shares and equities," "Investment trusts" and "Bonds" from total financial assets.
Source: Prepared by MHFG based on Bank of Japan's "Flow of Funds—Overview of Japan, US, and the Euro area—"