Agriculture and marriage. Entrust the regional bank to 18:50 on October 18

“Please leave us the sales of delicious agricultural products. We will introduce talented people who are in need due to labor shortage, and we will also assist you in marriage.” What kind of service will this company do? In fact, both are new initiatives initiated by local banks. Regional banks continue to be harsh due to population decline and low interest rates. The search has begun with a sense of crisis that if we continue only with conventional businesses such as lending, we cannot survive. I followed new movements that spread throughout the country.
(Ministry of Economic Affairs, Akihiro Shibata, Aomori Broadcasting Station reporter Akinori Yoshimoto)

Marriage is local bank

In September, I noticed an unusual business alliance announcement. Nagano Bank, Nagano Prefecture, will work with an IBJ company in Tokyo, which provides marriage-hunting services, to help single managers introduce their marriage partners.

Even so, why are banks helping with marriage? When I asked the person in charge at Nagano Bank, “It ’s a different kind of support for business succession.”

“Business succession” is now a major issue for industry. There are many small and medium enterprises that are out of business because there is no successor. Of course, Nagano Prefecture, where the population continues to decline, is no exception.

From the bank's perspective, the close-out of small and medium-sized companies and small businesses that lend to them is directly linked to the tapering of business. For this reason, Nagano Bank has been making efforts to introduce candidates for succeeding presidents to small and medium-sized companies that do not have successors, and to search for companies that can buy businesses.

Nagano Bank says, “Helping a single manager to marry can lead to the development of successors in the long run. We believe it will lead to future business.”

Such marriage support. The Bank of Nagoya in Aichi Prefecture has partnered with IBJ since last year. It is said that they are holding a marriage hunting party by talking to the single men and women of their business partners.

Employees are also local banks

“Human resource introduction” has also begun. It is a service that introduces employees and alumni from other companies to small and medium-sized business partners who suffer from labor shortages.

Banks connected to many local companies gather information on where and what human resources are available. There is no way to use it.

Hokkaido's Hokuyo Bank is a pioneer. Together with the Japanese materials organization of a human resources service company established under the leadership of the government, it introduces human resources who are responsible for management and finance to small and medium-sized business partners. That is said to make a profit.

National regional bank associations are stepping into making human resource services a banking business. A request is sent to the government to lift the “temporary staffing business” to local banks. They are looking for deregulation to register personnel at banks and send them to business partners.

We will advance to agriculture

Some regional banks are trying to find a way to “agriculture”. Aomori Prefecture Michinoku Bank. In January, in partnership with the IT company “Optim” in Tokyo, a company was established to support the cultivation and sales of agricultural products.

Aomori Prefecture's population decline rate is the second largest in the country. Michinoku Bank had a strong sense of crisis in shrinking the market. That was the main industry of agriculture.

In fact, farmers in Aomori Prefecture are younger than in the whole country. He supported the expansion of young motivated farmers and thought that it would be an opportunity if they could lend.

The key to realizing “earning agriculture” is “pesticide reduction” and supports the introduction of “smart agriculture” using IT. Take a drone and take a picture of the rice field from the sky. Analyzing the image with AI = artificial intelligence, narrow down the places where pests and weeds occur, and spray pesticides at a pinpoint.

According to the introduced farmers, the amount of agricultural chemicals has been reduced to about one-tenth, and the work time has been reduced to about one-third.

It also supports the sale of harvested rice. Targeted to health-conscious consumers, it is sold on the Internet shopping site under the name “Smart Rice”.

The package design has also been devised to emphasize “reducing pesticides”. Rice is now sold at 2.5 to 3 times the conventional price.

“If the farm grows in size, funds will be needed for incorporation and various capital investments.

The company established by Michinoku Bank is called a “regional trading company” that handles production support and sales of local specialties. The movement of regional banks to invest in regional trading companies as a new business has been steadily occurring throughout Japan, including Yamaguchi Prefecture and Niigata Prefecture.

Search for management improvement

The Financial Services Agency is also supporting local banks. Banks are basically prohibited from holding more than 5% of another company's shares.

This is because depositors are inconvenienced when banks fail to do anything other than their main business and their financial soundness is impaired. However, I reviewed it drastically. In October, it reviewed the supervisory guidelines and, if approved, clarified that the establishment of a “regional trading company” in which the bank is 100% owned.

The supervisory guidelines were changed so that human resources could be introduced. It seems to be a message from the Financial Services Agency that encourages the transition from a “bank” that exchanges money to a “service industry” that exchanges human resources, goods, and information.

Financial institution management advisor and Japanese asset management foundation Keiichi Ohara is also calling for a new field.

“The strength of regional banks is the network and trust with local residents and SMEs. I think the regional banks have the ability to become hubs for local human resources, goods, and information.”

"Crisis" proceeding quietly

The profit environment of regional banks is poor. In the financial results for fiscal 2018, “40% of customer service business income / loss”, which is related to lending and commissions, is actually in the red for about 40% of 105 banks nationwide.

Profit environment remains difficult for the time being due to prolonged BOJ's negative interest rate policy. Due to the bad debt problem after the burst of the bubble, many local banks once fell into crisis and were rescued by public funds.

Such confusion is not seen in the current regional banks. However, FSA executives are ringing alarm bells.

“We were able to deal with the crisis with public funds while criticizing the public in disposing of bad debts. Now, the crisis is proceeding quietly and gradually. Managers of regional banks must be aware of it.”

Perhaps there isn't much time for molting to see how local banks grow new business buds.

Economic Department Reporter Akihiro Shibata Joined Nagano Station in 2004 After working at Nagoya Station, now in charge of the Financial Services Agency

Aomori Broadcasting Bureau Reporter Akinori Yoshimoto Joined in 2012 Kumamoto Station Misawa Branch, now in charge of Aomori municipal administration and economic coverage