Flight of the Lady Part-5

Chapter 11

Let's talk about Money 

Let's discuss about the value of Money.

Let's discuss about the credibility of Money.

Let's discuss about the illusion of Money 

Let's discuss about the economy (Money) .

[T/N- I honestly don't know what author was trying to convey here , The Japanese version would be-

    金（価値）の話をしよう。

　金（信用）の話をしよう

　金（幻想）の話をしよう。

　経済（金）の話をしよう。]

That nightmare of a Chain Collapse of Banks...

The amount of non-performing loans(Bad Debts) is as follows:

- Sankai Securities: 80 billion yen

- Ichiyama Securities: 260 billion yen

- Hokkaido Development Bank: 2.3 trillion yen

Evidently, there exists a substantial variance in the scale of non-performing loans, with Hokkaido Development Bank's financial liabilities far exceeding those of its counterparts.

To mitigate potential damage to the Japanese economy, it was imperative to assist Hokkaido Development Bank. Unfortunately, procuring such a massive sum is beyond my means. The only entity in this nation capable of providing this amount is the Bank of Japan, through it's BOJ special Financing.

It can only be used upon government request, aiming to uphold credit integrity during financial crises, serving as the ultimate financial recourse.

The destiny of Hokkaido Development Bank hinges on the strategic utilization of this specialized funding, devoid of collateral or constraints, tailored for distressed financial institutions.

"First, let's start by utilizing the BOJ special Financing we currently have."

In the acquisition of Sankai Securities by the Far Eastern Bank, BOJ special financing has been poured into Sankai Securities.

As it lacks collateral or stringent constraints, this special financing continues to be a source of credit concerns, even following the acquisition announcement by Far Eastern Bank. Presently, a significant influx of BOJ special financing is ongoing.

Imagine forgetting to close the drain in a bathtub, and water is leaking from below while you keep pouring hot water. Does that make it a little clearer?

"That's is why we can do something quite reckless right now."

When I asserted this, Ichijou grimaced, and hesitantly asked.

When there Young lady starts talking like this, it seems she's up to something not-so-good. Indeed, when they asked about that not-so-good thing, both Tachibana and Ichijou were once again speechless.

"...I really don't want to know, but what do you intend to do?"

"As the saying follows If you desire to shoot a general, start by shooting his horse.To acquire Hokkaido Development Bank, we will first acquire Ichiyama Securities."

[T/N - Simply put , Runa acquired Sankai Securities have cleared for BOJ Special Financing or Loans , as it have no upper limit money keeps flows in (yeah you could commit fraud with it if you are smart enough), so she Decided to acquire Ichiyama Securities and merge with Sankai Making it "ONE" Company so they can solve Ichiyama's bad debts (yep also have these) with no cost on their part through already company BOJ Special Loans. All for take Hokkaido Development Bank (HBD), Ichiyama Securities to HBD is what Sankai for Far Eastern Bank, so near future it will be easier obtain BOJ Special Financing for HBD ]

.

" In a significant development, Sankai Securities, a notable Tokyo-based securities firm, has officially declared its intention to merge with the well-established Ichiyama Securities. The surviving entity is poised to retain the name Sankai Securities, as the post-merger nomenclature is anticipated to undergo unification.

The announcement comes as Ichiyama Securities, grappling with substantial non-performing loans, confronts not just financial challenges but also a leadership shakeup in the wake of revelations about profit-sharing dealings with questionable entities. The company appears to be in a state of turmoil.

According to certain weekly publications suggest that Ichiyama Securities is not merely under suspicion for loss compensation but is also rumored to be entangled with off-balance sheet debts. Some perceive the merger with Sankai Securities as an implicit rescue mission coordinated by the Ministry of Finance's Securities Bureau, triggering resistance from opposition parties."

"Ichiyama Securities, ahead of the merger with Sankai Securities tomorrow, publicly disclosed off-balance sheet debts, announced the resignation of the current management, and even go as far as to initiate criminal proceedings against the former executives.

According to the announcement, the total amount of off-balance sheet debts is reported to be a staggering 260 billion yen. All these non-performing loans, including these, are planned to be sold to the Resolution and Collection Corporation and recorded as special losses.

Sankai Securities held a press conference regarding these announcements and emphatically stated, 'We have no intention of canceling the merger.'

 The Ministry of Finance also announced, 'For the sake of financial stability, we have no intention of discontinuing the BOJ special financing currently provided to Sankai Securities.'"

Finding an internal whistleblower among Ichiyama Securities' employees was not much of a difficult task, and leveraging the Keikka-in family's immunity from arrest as leverage, Tachibana and Ichijou gathered information. Using this as a basis, they approached Ichiyama Securities with a merger proposal with Sankai Securities after coordinating with Far Eastern Bank.

Due to the profit-sharing scandal and the resulting leadership overhaul, Ichiyama Securities became dysfunctional. The Ministry of Finance's Securities Bureau, which failed to supervise this, had no choice but to accept the conditions presented by us.

However, what truly influenced the decision was highlighting Ichiyama Securities' hidden off-balance sheet debts[T/N - again bad Debts] and the imminent risk of insolvency during the loss settlement process. The Ministry of Finance's Securities Bureau absolutely aims to steer clear of a situation where insolvency is certain during the loss settlement process.

Upon Tachibana's firm words, stating that they would rescue Ichiyama Securities if they adhered to the Keikka-in Rule we presented, they had no choice but to accept the conditions we issued whole.

"Imagine this: The Securities Bureau, rather than the Ministry of Finance Banking Bureau, is now stuck dealing with a significant bankruptcy situation. It's a notable slip-up, and certainly not something they'd want to bring into the limelight, don't you think?"

Banzai (Hail/Hurray) to the bureaucratic silo system*.

[T/N-Silo system, when a division have number of sub-division with little to no communication between them]

The advantageous aspect of this merger, where the smaller Sankai Securities engulfs the larger Ichiyama Securities, lies in the fact that Sankai Securities, being the smaller entity, is still receiving substantial BOJ special financing. Morally*, it may be questionable, but legally, it allows for the legitimate procurement of relief funds from the BOJ to assist Ichiyama Securities.

[T/N - she just over-reacting in her Villainess roleplay]

Another crucial point is making all concealed assets visible, which enables a thorough management of non-performing loans. When two financial institutions merge, the surviving company combines all assets. During this consolidation, the assets of the absorbed company are revalued at their current market worth. Essentially, this means inheriting assets at their fair market value during the merger, inherently classifying them as not non-performing loans.

For the truly problematic ones that remain, they are sold off to the Resolution and Collection Corporation. Concerns like account closures are covered using BOJ special financing.

The media pays no attention to this logic. Instead, they focus on the noticeable aspects, such as the second resignation of all Ichiyama Securities executives, the criminal prosecution of the former executives, and not using the name "Ichiyama" after the merger. Thanks to this, headlines like 'Dissolution of Ichiyama Securities' are reported in an amusing and entertaining manner. In a way, it's convenient as it helps stage the resolution of accountability issues.

Regardless, 'Ichiyama Securities' was saved 

It's now August.

Following the successful rescue of Ichiyama Securities after Sankai Securities, all eyes in the market are now focused on Hokkaido Development Bank – the last remaining target. It's facing an incessant wave of sell orders.

Having already teetered on the brink of bankruptcy due to a failed merger with a local regional bank, Hokkaido Development Bank lacks the resilience to endure this intense selling pressure. As its stock price dropped below the critical bankruptcy threshold of 100 yen and approached a precarious 59 yen, I took the decisive step: I declared a tender offer 'TOB'* for Hokkaido Development Bank.

[T/N - Runa Directly went for the share holders to acquire a large portion of the company (30% to 60%)]

.

"Moonlight Fund, headquartered in California, USA, announced a tender offer (TOB) for Hokkaido Development Bank today at noon.The purchase price is 74 yen.The aim is to acquire over half of the total shares, starting from one-third.The offer period extends until the end of October."

Now, with several billion yen drawn in the drain, let's cast our lot into the pit and attempt to rescue both Hokkaido Development Bank and the Japanese economy.

________________________________________________

The profit-sharing scandal with racketeers ultimately dealt the final blow to Yamai Securities.

Engaging in such activities, leading to the revelation of off-balance sheet debts and accepting BOJ special financing, would undoubtedly infuriate the public. However, since these issues were pointed out externally, it allowed us to stage a rigorous dissolution in this narrative.

Regarding the Ministry of Finance Securities Bureau and the Ministry of Finance Banking Bureau, after reading "Revealing the 'War Criminals' who Crushed Hokkaido Development Bank," I was astonished. It seems that the Securities Bureau was entirely focused on Yamai Securities, while the Banking Bureau was completely focused on Hokkaido Development Bank, and there was minimal communication between the two. Consequently, as both collapsed in a chain reaction, both entities suffered a significant blow to their reputations.

Following this, in the subsequent No-Pants Shabu-Shabu Incident, the Ministry of Finance was dismantled, leading to its restructuring into the Financial Services Agency.