Noriyuki Morimoto's Blog
Osekkai Japanese Finance
Sep 10, 2018
If you look up the word “osekkai” in the dictionary, it is defined as unnecessarily interfering with people’s matters. But whether any act is unnecessary or not depends on the subjective view of the recipient of osekkai: for the person who carried out the osekkai act, it is done because it is necessary.
Tetsugoro Obara, who was a leading figure in the Japanese financial industry, is quoted as saying "not lending is also kindness". He meant that when considering a loan application based on the customer's true benefit, there are cases where refusing the loan may be beneficial to the customer, depending on factors like the purpose of the money.
Tetsugoro Obara was adamant in refusing loans, even with sufficient collateral, when their intended use was something like real estate speculation. He reasoned that it would ultimately prove to hurt the customer. Whoever was refused a loan in this manner must have been very frustrated.
By contrast, those who took out loans to buy real estate during the Showa bubble period must have felt very satisfied at the moment. However, given that many of them were economically destroyed, such actions of the financial industry had been proven to run against the true interests of their customers, and the financial community itself suffered a huge loss as well.
If the financial community had been faithful to Tetsugoro Obara’s philosophy, the Showa bubble could have been prevented. Tetsugoro Obara believed that it is kindness to consider the real benefit of the customer. Therefore, as long as one maintains kindness, he believed that he could not lend what he could not lend, even if it damaged customer satisfaction. And he was convinced that maintaining that kindness would prove beneficial for the financial community.
Actually, Tetsugoro Obara referred to financing a customer as "worrying for” a customer. That is a totally osekkai attitude.
Chief Executive Officer, HC Asset Management Co.,Ltd.
Noriyuki Morimoto founded HC Asset Management in November 2002. As a pioneer investment consultant in Japan, he established the investment consulting business of Watson Wyatt K.K. (Tokyo Office) in 1990, where he was Director & Consultant for 13 years. His responsibilities also included Benefit consulting and Financial Services consulting. Prior to joining Watson Wyatt, he was responsible for foreign fixed income investment, asset allocation and investment strategy at Mitsui Life Insurance Co., where he managed assets for the company’s variable life products and group annuities as a fund manager. He spent 2 and half years in London managing fixed income assets. He started his investment career as Japanese equity analyst at Mitsui Life in 1983. Bachelor of Arts (Philosophy), University of Tokyo (1981)