Policy Conflict of Interest Management
Policy Conflict of Interest Management
1.Objective
As the services provided by financial institutions have been diversified, the risk of conflict of interests between financial institutions and their customers (hereinafter “conflict of interests”) have gradually increased.
The Shizuoka Bank Ltd. (hereinafter “the Bank”) establishes the “Policy for Conflict of Interest Management” in order to adequately control the transactions with a potential risk of the conflict of interest (hereinafter “transactions with a risk of conflict of interest”), and protect our customers’ profits from undeserved loss.
2.Definition
The terms definition of this policy is as follows.
a. Customers
The customers who are concerned with a banking business or financial instruments business of the Bank or its group companies subject to this policy.
b. Banking business
The business which is conducted by banks under the Banking Law.
c. Financial instruments business
The business related to financial instruments trading, registered financial institution businesses and businesses derived from the financial instruments businesses under the Financial Instruments and Exchange Act.
d. Target group companies
Within the consolidated subsidiaries or affiliate companies under equity method, the following companies are subjected to the Bank’s control of the conflict of interest.
- Shizugin Management Consulting CO., Ltd.
- Shizugin Lease Co., Ltd.
- Shizugin DC Card Co., Ltd
- Shizuoka Capital Co., Ltd.
- Shizuoka Bank (Europe) S.A.
- Shizugin TM Securities Co., Ltd.
- Shizugin Saison Card Co., Ltd.
3.Transactions with a risk of conflict of interests
3.1
In case where there is a risk of the under mentioned situations caused by transactions conducted by the Bank or target group companies, such transactions shall be managed as the transactions with a risk of conflict of interests (hereinafter “Transaction to Be Managed”).Those situations are as follows.
a.
situation where the Bank or target group companies makes profits based on the disadvantage of the customers.
b.
A situation where above a. is against the laws and regulations, or against the duties based on the contract with the customers or a position under Fair and Equitable Principles.
3.2
The target transactions are categorized as shown below in order to appropriately control by means of setting up the control method by category. In addition, according to a specific situation, each transaction shall be judged whether if it is an applicable as Transaction to Be Managed.
Category 1: Negotiated Transaction Type
Transactions, which are conducted between the Bank or the target group companies and customers, where there is a risk of damaging customers’ profit.
Category 2: Representation of both parties & competitive transaction Type
Transactions, which are conducted between the Bank or the target group companies and the counter parties, who are competitors of or whose interest conflicts with the customers, where there is a risk of damaging customers’ profit under the transactions, which are conducted between the Bank or the target group companies and customers.
Category 3: Proprietary Trading Type
Securities transactions issued, held or to be purchased or sold by the customers, which are conducted by the Bank or the target group on the own account of the Bank or the target group companies, where there is a risk of damaging customers’ profit under the transactions, which are conducted between the Bank or the target group companies and customers.
3.3
Regarding the Transaction to Be Managed, the Bank shall appropriately control by means of choosing several methods or measures from the listed as follows and combining them if necessary.
a.
Set-up of Chinese Wall
b.
Information disclosure for customers
c.
Obtaining customers’ agreement
d.
Modification of the terms or methods, or suspension of the target transactions
e.
Modification of the terms or methods, or suspension of the transactions of the customers whose profit will be damaged by the target transactions
4. Conflict of Interests Management Structure
4.1 The responsibility of the conflict of interest management
A compliance manager shall play a roll as the responsibility of the conflict of interest management. The responsibility of the management shall supervise the conflict of interests management structure in accordance with this policy.
4.2 The Division of the conflict of interest management
Compliance Dept. shall be a division of the conflict of interest management. The division shall gather necessary information for the control of the conflict of interest, organize the management structure, conduct an appropriate management, verify and conduct a necessary improvement, as well as record and keep the matters appropriately. In addition, the conflict of interests management structure shall be informed completely through all staffs by means of a study session etc.