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Japan Post Bank to suspend consignment of certain loans to Suruga Bank

Japan Post Bank Co. Ltd. will suspend part of its real estate and mortgage loan consignment to Suruga Bank Ltd. starting Oct. 12 for a period of six months, amid a lending scandal at the latter.

The move follows the Financial Services Agency's Oct. 5 suspension order on Suruga Bank, which banned the bank from extending new loans for real estate investments for six months.

Suruga Bank had been subject an investigation by the FSA since April, following reports on improper loan application screening at the lender related to a home sharing investment scheme.

A third-party investigative panel had concluded in September that top executives at the bank had breached due diligence obligations by overlooking some employees' practice of approving improper loan applications to meet quotas.

As of Oct. 9, US$1 was equivalent to ¥113.09.