He was speaking a day after the bank was fined a record $340m in the United States for concealing a $1.1bn unauthorised bond trading loss from American regulators.
As a consequence of the bond trading scandal, which forced Daiwa to close all its operations in the US, the Japanese bank was believed to have accepted a merger with Sumitomo as a way out of its crisis.
In accepting its punishmentfor covering up huge trading losses by a rogue bond trader over 11 years, Daiwa gave satisfaction to indignant US regulators and itself avoided a lengthy trial. Mr Kaiho also said Daiwa would be able to post profits for current fiscal year ending 31 March.
Announced late on Wednesday, the guilty plea in a Manhattan court brings to an end the whole humiliating mess that has strained US-Japan economic ties and cast doubt on the bank's very future. Daiwa shares rose on the news in Tokyo yesterday.
In the end, Daiwa, which sold its US operations last month to Sumitomo, pleaded guilty to 16 charges of covering up, conspiracy, falsifying books and obstructing examination of its books by US regulators. Until its plea, the bank had denied all the charges.
Had Daiwa held out, a high profile criminal trial against it would have started on 15 April. A guilty verdict at trial, moreover, could have meant the bank paying a much larger fine, perhaps as much as $1.3bn.
All that remains to be done in the affair is the sentencing of Toshihide Iguchi, the trader who has already agreed to his guilt in incurring the $1.1bn loss, and the trial of the New York branch's former general manger, Masahiro Tsuda, who has pleaded innnocent to the charges against him.
The pleasure of the American government is evident. Mary Jo White, the US Attorney in Manhattan, said the guilty plea "should serve as a message to other corporations".Reuse content