Mizuho Financial to name Masahiro Kihara as group CEO: sources

[TOKYO] Mizuho Financial Group is set to name Masahiro Kihara chief executive officer, according to people with knowledge of the plans, as Japan's 3rd-largest banking group seeks to reshape itself following a slew of technical troubles and regulatory penalties.

The appointment is set to be decided upon at a board meeting on Jan 17, and Kihara will take office on Apr 1, when his predecessor Tatsufumi Sakai plans to depart, according to the people, who asked not to be identified discussing information that isn't public.

Yasuhiro Sasaki, a spokesperson for Mizuho, said a decision hasn't been made yet. The plans were first reported by the Nikkei newspaper.

Kihara, 56, is a senior executive officer and head of the global products unit, which handles investment banking businesses such as syndicated loans, bond issues and mergers advice. A career insider, he joined what is today's Mizuho in 1989 and has also had stints in areas including risk management and finance.

Sakai said in November that he would step down after the country's regulator issued a business-improvement order and said the lender didn't pay enough attention to risks within its computer systems. The management shakeup marks another chapter in Mizuho's struggles with repeated technical failures since its creation more than 2 decades ago.

REGAIN TRUST

The new CEO will need to regain trust from customers as well as the nation's financial regulator, which has accused the lender of failing to learn from past incidents.

The series of glitches started in February, when ATMs swallowed more than 5,000 cash cards and passbooks. A month later, a hardware failure caused a delay in 300 foreign-currency money transfers. By the time Sakai announced his planned departure, there had been 8 such incidents since the beginning of 2021.

The smallest of Japan's 3 megabanks, Mizuho also has been struggling to catch up with bigger rivals that are expanding beyond traditional lending into investment banking and wealth management.

Mizuho has also been diversifying. In its latest move, the bank agreed to buy US-based Capstone Partners to expand in the business of helping private equity firms raise funds. The deal is slated to be completed in the first half of the year, the bank said in a statement on Monday (Jan 10).

Sakai, who became CEO in 2018, has been trying to reshape the bank and change its corporate culture. He made major modifications to its organisational structure to focus resources on growth areas and rein in costs.

Despite the system troubles, Mizuho reported sharp profit growth for the first half ended in September and announced its first dividend hike in 7 years.

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