Mourning the two bunkers who challenged the financial crisis-Lessons for the era of confusion-February 10, 16:18

Last year, two representative Japanese bunkers died.

Katsunori Nagayasu, former president of Bank of Tokyo-Mitsubishi UFJ (currently Bank of Tokyo-Mitsubishi UFJ), and Koichi Miyata, former chairman of Sumitomo Mitsui Banking Corporation.

He boldly confronted the global financial crisis triggered by the Lehman shock.

We will explore lessons from two bunkers to overcome the crisis in an era when the future is not difficult to predict, such as the corona disaster, the response to decarbonization, and the financial markets that have entered a turning point.

(Reporter, Economic Department, Neil Kato / Akihiro Shiraishi)

"Pride" who decided to make a huge investment

May last year.

Katsunori Nagayasu, the former president of the former Bank of Tokyo-Mitsubishi UFJ, has passed away.

He was 74 years old.

Mr. Yong Yi led a huge investment in the prestigious investment bank "Morgan Stanley" in the United States as the president at the time of the Lehman shock.

He played an important role in breaking the chain of further financial crises.

Nobuyuki Hirano, who took over the top management after working to invest in Morgan Stanley under Mr. Nagayasu, recalls that he was loved by customers anyway.

Nobuyuki Hirano, Special Advisor of Bank of Tokyo-Mitsubishi UFJ

"The habit is,'Banks are useful for customers.

' I look straight at it, and if something goes wrong, I can't stop halfway through. Even if there is a risk that I will be responsible for it, I will pursue it.

His way of thinking and actions would have touched the hearts of the customers. "

On September 15, 2008, the major investment bank Lehman Brothers went bankrupt.

Where is next?

Wall Street falls into suspicion, and the stock prices of financial institutions plunge one after another.

The beginning of the Morgan Stanley rescue drama was a single phone call to Mr. Hirano at midnight.

A Morsta representative wants to have a discussion with the CEO the next morning.

Mr. Nagayasu usually didn't answer the phone in the middle of the night, but this time he answered the phone.

Mr. Hirano recalls that he might have felt something.

If chain bankruptcy continues as it is, the world financial system may collapse.

Asset assessment before investment is only 72 hours.

On the 22nd, a week after the collapse of Lehman Brothers, the company announced its investment policy in Morsta, and the following month, a check of 900 billion yen was delivered to Morsta's law firm.

Huge investment in a situation where the bottom is invisible.

At that time, some people said, "It's like grabbing a knife with your bare hands."

Why did you decide to make a huge investment?

Mr. Nagayasu boasted that he was strong in games such as mahjong.

It is said that he had a good intuition, but Mr. Hirano points out another aspect.

Mr. Hirano:

"I didn't show it to the public because I was told by the people around me that I had a unique intuition, and I wasn't too lazy, but Mr. Nagayasu was a person with a strong sense of detail and realism. I invested without much consideration. However, in fact, we have been conducting sufficient research and examination as a basis for a long time. "

Three years before the Lehman shock, banks set up a project team to launch the investment banking sector amid growing needs for M & A and other issues due to the global expansion of private companies.

Mr. Hirano served as the secretariat.

Mr. Nagayasu, who was in charge of corporate sales at that time, also joined and led the discussion.

Members are considering plans to establish their own investment banks or to acquire mid-sized investment banks.

One of the most promising plans was to invest in a major investment bank.

Morgan Stanley was also included in the list.

Mr. Hirano reveals that the detailed discussions here determined the rest.

Mr. Hirano

"Mr. Nagayasu was not an investment banking expert, but he had a very strong attitude to learn and listened to people's opinions. I also made harsh points many times. "

"However, it is a different matter whether we can take action. In addition to this realist aspect, Mr. Nagayasu's pride that he must continue to fulfill his social mission as a financial institution is crucial for deciding to invest. was"

After that, Mr. Nagayasu responded to the crisis by taking the lead in dealing with losses on subprime mortgages and increasing capital by a total of 2 trillion yen to strengthen the financial base.

It has been 14 years since the Lehman shock.

Mr. Hirano says that the attitude of facing Eiyasu from the front is a hint in this era.

Mr. Hirano:

"I was a person who always faced the reality and acted. On the contrary, I hated the idea first. I strongly admonished the idea of ​​entrusting myself to fluffy things and temporary floating flows. Is full of inconvenient truths and everyone tries to look away from them. "

"But Mr. Nagayasu digs out the problem and digs into what to do. He says that the crisis will repeat, but he prepares for it on a daily basis and acts without flirting in the event of an emergency. I think it will be important in confronting it. "

"Boldness" to be calm enough to cause problems

Bankers, who prevented banks from expanding their losses, died last year as financial institutions around the world suffered heavy losses due to the financial crisis.

Koichi Miyata died of pancreatic cancer at the age of 67 last October.

During the financial crisis, he was managing director of the market sector.

After that, he became president of Sumitomo Mitsui Financial Group in 2011, and was chairman of Sumitomo Mitsui Banking Corporation from 2017 until the day of his death.

Approximately 2,600 people from the industry attended the "Farewell Party" held at two venues in Tokyo and Osaka last December, and regretted the premature farewell.

Mr. Miyata's achievements were spelled out in the message given jointly by Mr. Takeshi Kunibe, President of Sumitomo Mitsui Financial Group, President of Sumitomo Mitsui Banking Corporation, and Mr. Makoto Takashima, President of Sumitomo Mitsui Banking Corporation.

Koichi Miyata Thank you for the farewell party Partial excerpt

I joined Mitsui Bank and demonstrated leadership in the market sales department for a long time.

In the market sales division, we used multifaceted analysis and calm judgment as a weapon to manage a portfolio with a good balance between offensive and defensive, and contributed to profit expansion.

During the financial crisis triggered by the US subprime mortgage crisis, we quickly spotted signs of deterioration of securitized products and sold them all at once to prevent the spread of losses.

At that time, Masamichi Koike was working as a subordinate of Mr. Miyata in the market department.

He recalls Mr. Miyata as his boss, "The more problems I had, the more calm I was."

Sumitomo Mitsui Financial Group Managing Director Masamichi Koike

"I often used the word" supple and tatami ". I think it was Mr. Miyata's name, but he was the person who embodied this.

We, the market division, are the market price .

Is the other person, and a lot of unexpected events and unexpected things happen. When you face it, you should not be shaken. What is the right thing to think for yourself, the essence of things It is most important for us to calmly identify

"In that sense, Mr. Miyata was a brave person, a person who became more calm as something went wrong."

The subprime loan problem that caused the Lehman shock.

As losses began to surface among financial institutions, the market division led by Mr. Miyata quickly grasped the situation and sold related products.

The loss was kept to a minimum.

Why did you decide to sell it?

Mr. Koike talks about the reason as follows.

Mr. Koike

"The entire market division, including Mr. Miyata, shared the basic idea that" things that are strange in the world are strange no matter how you look at them. "As real estate prices gradually decline, stock prices rise. CDS = credit default swap, a financial product that prepares for the risk of bankruptcy of companies, has not risen at all for nearly two years. "

"I think the reason why we were able to do this is because the idea that we should make a statement by honestly thinking that something strange is strange was shared at the root of the market sector."

This year, the market remains volatile.

Tensions between the United States and Russia over Ukraine, soaring raw material prices, and disruption in the production network of companies due to the spread of the new corona infection.

With growing concerns about inflation, the United States has indicated that it will rush to tighten monetary policy, the foreign exchange market and stock markets have become more volatile, and Japan's long-term interest rates have reached their highest levels in six years.

Mr. Koike, who was in the same position as Mr. Miyata at the time in charge of the market sector, points out that the market may become rough depending on the monetary policy of the United States.

How should we deal with the difficult situation where risks overlap and the future is uncertain?

Mr. Koike, along with Mr. Miyata, thinks that he can make use of the experience of the Lehman shock, which he responded with courage to "be supple and tattooed."

Mr. Koike

"The funny thing is certainly funny, but not everyone notices it right away. It's hard to guess when it will come, but it pops somewhere. Don't miss it, exactly ( I'm telling my subordinates to confront the market with "boldness" (Mr. Miyata had). "

Two bunkers who faced the global financial crisis triggered by the Lehman shock.

What they have in common is the ability to calmly assess the essence of things and to believe that they are right.

The footprints of the two are for managers and leaders because it is an era when the future is not difficult to predict, also called VUCA (Volatility = variability, Uncertainty = uncertainty, Complexity = complexity, Ambiguity = ambiguity). It gives important hints.

* Is "high" a ladder?

Neil Kato ,

Reporter of the Ministry of Economic Affairs , joined the Shizuoka Bureau in

2010

,

and now belongs to the Osaka Bureau.

Reporter of the Ministry of Economic Affairs

Akihiro Shiraishi

Joined

the Matsue Bureau in 2015.

After working in charge of the steel industry and the Financial Services Agency, he has been interviewing the Bank of Japan and major banks since November last year.