End of Ymaichi Brokerage House

Yamaichi Brokerage House Closed
Yesterday, world news agencies reported the closure of Japan's largest and oldest brokerage house, Yamaichi Securities Co.

Yamaichi Securities Co has been called one of the most powerful players on the Tokyo Stock Exchange. It is noteworthy that the brokerage house ceased to exist just in the year of its centenary.
Let us recall that Yamaichi Securities, one of the most famous investment banks in Japan, was one of the four most influential brokerage houses in the country. By the time it declared bankruptcy (the brokerage house's shares were withdrawn from the Japanese stock market last Friday), Yamaichi Securities' debts from losses exceeded 3 trillion yen (about $25 billion). The bank's total assets were approximately 24 trillion yen (about $200 billion).
A few months ago, the management of Yamaichi Securities asked to save the bank by providing it with urgent loans to both Japanese (in particular, Fuji Bank Ltd.) and foreign partners. However, they refused. About a month ago, the Central Bank of Japan allocated the largest subsidy in the entire history of the country to Yamaichi Securities in the amount of $8.2 billion. At the same time, the Japanese government rather harshly stated that it did not intend to make any further efforts to save the “lost face” bank. This decision was also influenced by the ongoing scandal surrounding connections between Japanese brokers and racketeers. Yamaichi management was also involved in the scandal. Last year, the bank's board fired 11 senior managers with links to organized crime. And in early March 1998, prosecutors arrested three former high-ranking Yamaichi officials on charges of illegal financial activities. To camouflage losses of 274 billion yen ($2.1 billion) during the audits, they temporarily moved funds from their clients' accounts.
And so on April 1, the last day of the fiscal year, Yamaichi, which had been gradually closing its divisions for five months, announced the liquidation of the last forty.

ELENA Kommersant-MAKSIMENKO

Newspaper "Kommersant" No. 57 dated 04/02/1998, p. 10