MUFG Penalizes Top Executives Amid Firewall Regulation Breach

Mitsubishi UFJ Financial Group (MUFG) has announced salary cuts for its CEO and five other executives following the violation of 'firewall' regulations. The Financial Services Agency (FSA) demanded business improvement plans from MUFG due to the unauthorized sharing of client information and preferential lending rates. The penalties include significant salary reductions for current and former directors.

Mitsubishi UFJ Financial Group (MUFG), Japan's largest banking entity, will slash the salaries of its CEO and five other high-ranking executives due to breaches of 'firewall' regulations. This move follows a directive from the Financial Services Agency (FSA), which highlighted the need for business improvement plans after finding unauthorized client information sharing and preferential lending rates.

The salaries of Group CEO Hironori Kamezawa and five other executives will be reduced by 30% for periods ranging from two to five months, according to a company statement. Additionally, MUFG has requested that three former directors from its banking unit and one from its securities sector return between 10% and 30% of three months' salary.

In regulatory filings, Kamezawa reported an annual earnings of 339 million yen ($2.16 million) as of March 2024. The FSA's investigation uncovered at least 26 instances of confidential client information being shared between MUFG Bank and its securities affiliates with Morgan Stanley from 2020 to 2023, alongside cases of offering preferential lending rates to joint clients. MUFG has now submitted a compliance improvement plan to the FSA.

(With inputs from agencies.)