1981 BANKING LAW. COPYRIGHT RODERICK H. SEEMAN

Article 4 (Business License)

1. Banking business cannot be conducted unless it is by parties licensed by the Minister of Finance.

2. The Minister of Finance, when he has received an application for a banking business license, must make an examination as to whether or not the following standards are satisfied.

(1) The party who has applied for a banking license (hereinafter in this Paragraph referred to as the "applicant") has a sufficient asset base for the healthy and efficient performance of the banking business and whether the outlook for the income and expenditures of the said business of the applicant is favorable.

(2) The applicant, in light of its personnel structure, etc., has the knowledge and experience whereby it can accurately, fairly and efficiently perform the banking business and possesses social trustiworthiness.

(3) The initiation of banking business by the applicant is suitable, in view of the supply and demand condition for funds, the business conditions of banks and other financial operations and other economic and financial conditions in the region where the said banking business will be performed, and that there is no concern that the financial order will be disturbed.

3. In those situations where the party who has applied for a banking business license has as a total or partial shareholder a party (including the parties who are in a special relations with that party as determined by Cabinet Order, excluding banks, etc. Hereinafter in this Paragraph referred to as "foreign banks, etc.") who conducts banking business in a foreign country based on the laws and regulations of a foreign country, when the said foreign bank legally possesses shares exceeding the number obtained by multiplying a ratio as determined by the Ordinance of the Ministry of Finance by the total number of issued shares of the party which has made the application for the said license, in addition to the standards of each of the Items of the previous Paragraph, the Minister of Finance must make an examination as to whether or not it can be understood that the handling of the bank in the country where the said foreign bank, etc., has its main places of business is substantially the same handling as based on this Law. However, this shall not apply where examination hinders the sincere performance of international commitments or other situations provided by Cabinet Order.

4. The Minister of Finance, when he deems it so necessary in the public interest in light of the standards of examination based on the provisions of the previous two paragraphs, to the extent necessary, may attach conditions to the license of Paragraph 1 and make revisions thereto.

5. The "banks, etc." of Paragraph 3 shall mean banks, the long term credit banks provided for in the Long Term Credit Bank Law ((Choki shinyo ginko ho) Law No.187, 1952) and the foreign exchange banks provided for in the Foreign Exchange Bank Law ((Gaikoku kawase ginko ho) Law No.67, 1954)