( RIA Novosti ) - The world's largest bank has been established in Japan as one of the first steps towards privatizing the country's mail service.
The Japan Post Bank, with some 187 trillion yen ($1.6 trillion) capital, will be part of a large holding, initially owned by the government under a ten-year privatization scheme.
Prime Minister Yasuo Fukuda said at the presentation ceremony that he hopes the reforms will, "improve the efficiency of its management and fully utilize its network.''
The holding will be divided into four businesses providing banking, mail delivery, over-the-counter services and insurance, which will include the Kampo Seimei insurance company with assets estimated at 113 trillion yen ($980 billion) creating a major financial structure.
The move has already raised concerns among some banking sector players over government support.
Japanese Bankers Association head Masayuki Oku said he hoped the new bank would comply with free competition principles and join the market smoothly.
Analysts say the bank is geared towards new investment tools, with some 80% of savings currently invested in government bonds.
The idea to privatize the extensive postal service, which comprises over 24,000 departments throughout the country and 240,000 staff, was proposed by former prime minister Junichiro Koizumi in 2005.