Brian Bremmer, Business Week’s Tokyo correspondent, has a great commentary on the criticism surrounding the Shinsei Bank IPO. Bremmer argues convincingly that the people to blame are not the Americans who profited from turning around a moribund bank, but the Japanese bank regulators who: a) looked the other way in the early-to-mid-1990s when these Japanese banks were lending cash to the worst businesses; and b) those same bank regulators who signed the deal with Ripplewood (good or bad, they signed the deal.)

Japan should consider its own missteps, though. For starters, the gaijin aren’t the villains. The real bad actors in this drama are the bank regulators who for years failed to detect book-doctoring and outright lies and corruption by the bankers running LTCB. Had feckless regulators done their jobs in, say, 1993 or 1994, the bank could have been saved, merged, or sold off without costing taxpayers anywhere near as much.
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The Japanese should also come clean about what’s really bothering them. Ripplewood’s profits have certainly upset many. But more disturbing is that the gaijin exposed Japan Inc.’s propensity for hiding unpleasant truths. By repeatedly and publicly uncovering more bad loans hidden away in Shinsei, the bank’s foreign owners showed how rotten Japan’s financial edifice really was. The gaijin not only outwitted the Japanese: They humiliated them.

BW Online | Commentary: The Gaijin Aren’t At Fault Here [businessweek.com]