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Japan's corporate rescue chief seeks businessmen's help

Japan's new corporate rescue chief started work yesterday saying he needs businessmen to help him decide which indebted companies the country should salvage.

Sadakazu Tanigaki will build and lead the agency, as yet unnamed, which will offer loans and investment to viable companies hurt by government efforts to clear up the estimated US$432 billion in bad loans held by Japanese lenders.

Tanigaki has rescue experience: He was Japan's financial reconstruction chief in 2000 when then Prime Minister Yoshiro Mori attempted to bail out department store operator Sogo Co.

In his inaugural press conference yesterday, Tanigaki said he needs corporate help. "The agency will decide the fate of companies and I don't believe we can make this kind of judgment based only on the government's experience," he said.

Japanese business leaders last month criticized Minister for Financial Services Heizo Takenaka for establishing a bad-loan task force headed by Takeshi Kimura, president of accounting firm KPMG's Japan unit, that didn't include corporate executives.

Welcoming executives to the new agency may represent a step to ease concerns about Takenaka, who has said that no company was too big to fail. Takenaka's approach makes it difficult for him to win cooperation, so choosing an alternative to head the new agency was essential, said Minoru Morita, a political commentator and head of Morita Research Institute.

"Letting Takenaka take control of this would have been a disaster," Morita said.

Hiroshi Okuda, head of the Japan Business Federation, the country's most powerful business lobby, Wednesday urged the government to appoint experienced business managers to the new agency. Okuda is also chairman of Toyota Motor Corp, the country's biggest automaker.

Government ministers have added to the calls for cooperation with the business community. Finance Minister Masajuro Shiokawa urged Tanigaki to appoint a person from industry as his second-in-command.

"It's going to be difficult rehabilitating without the help of people from the private sector," said Hisanori Kataoka, an equity analyst at Standard & Poor's rating service.

Japan's lenders were estimated to hold ?52.4 trillion (US$432 billion) in bad loans as of March 31, with about half that figure held by the country's seven biggest banks.
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