Tokyo, 1991: Starting as a bank clerk

Chapter 235 Heroes of the World Are Indeed as Numerous as Carp Crossing a River [Basic Update 5k words]

Kiryu Yaya sat back down at his workstation and casually picked up the folder on the table.

The above is in Masakazu Yamada's handwriting: "Miyazawa Group - Guarantee Release Document"

In banking practice, collateral is the bank's last line of defense for the security of a debt.

As long as this line of defense remains in place, banks have the right to recover funds by disposing of collateral when a company defaults.

Part of the land in Rinko City was used as collateral for the 8 billion yen credit line for the Miyazawa Tourism Development project.

This means that as long as Mitsubishi Bank retains its mortgage on the Rinko City plot in the Legal Affairs Bureau's register, the land cannot be freely transferred.

Potential buyers will see this guarantee registration during due diligence, and in most cases, they will choose to abandon the deal or significantly reduce their offer price.

Because nobody wants to spend tens of billions to buy an asset that could be disposed of by the bank at any time.

Therefore, after the Miyazawa Group decided to sell the Rinko City plot, this valve had to be opened first in order to complete the transaction.

The guarantee release document is that key.

From Mitsubishi Bank's perspective, the release of the guarantee was not unconditional.

The Miyazawa Group must replace the land's guaranteed status with other assets or cash flow.

It could involve adding other real estate as collateral, prepaying a portion of the loan, or adding a joint guarantee in Miyazawa Keiko's personal name.

In short, banks will only issue the release confirmation letter if the security of the creditor's rights is not compromised.

From the perspective of the Miyazawa Group, obtaining this letter is equivalent to obtaining a "free pass" for the Rinko City plot.

.

Without it, the transaction would be stuck halfway through, and neither party could proceed.

From the perspective of Takahashi Taishi's shell company, they would only actually transfer the funds into the designated account after seeing written confirmation from Mitsubishi Bank that the guarantee had been released.

This is the most basic risk control logic in M&A transactions: the transfer of funds and ownership must be completed simultaneously, otherwise it will pose a huge risk to both the buyer and seller.

Kiryu Yaya glanced at the document; it was a standard template for releasing a guarantor. After a brief look, he set it aside.

Start your happy time of slacking off.

He was thinking about registering for driving school after get off work, and also about the Mercedes-Benz S600.

Ah, I kind of want to drive it out and show off.

A Mercedes-Benz S-Class – a lifelong dream for many.

I aim to get my license by the end of August.

That talent exchange program seems to be in August, which is perfect timing to pick up the car in Tokyo.

Kiryu Yaya leaned back in his chair and closed his eyes.

Take a short rest.

Use a skill by the way

[Reset Fatigue]

Ten minutes later, Kiryu Yaya slowly woke up, all the fatigue he had accumulated over the day gone.

He clicked his tongue inwardly.

It's milder than Red Bull and works faster, but it lacks the kick of Red Bull.

That's fine. It won't harm your kidneys.

2:30 p.m.

Just as Kiryu Yaya was continuing to slack off, Yamada Masakazu suddenly rushed out of the office, stood in front of him, and said quickly, "Kiryu-kun, come with me."

Seeing his hurried appearance, Kiryu Yaya realized that something was wrong and asked in a low voice, "Section Chief, what happened?"

Masakazu Yamada glanced around and then whispered to Yaya Kiryu, "Managing Director Nakajima is looking for you."

Those six simple words caused Kiryu Yaya's pupils to shrink sharply.

Managing Director Nakajima—

Looking for him!?

This is illogical.

What makes him, a newcomer to the financing review department of the Osaka branch, entitled to be summoned by the head office director?

Could it be because he also attended the auction that day?

No, that's definitely not the reason.

The bidding process was discussed, and Masakazu Yamada was also present at the time. If one wanted to understand the situation at that time, it would have been more appropriate to ask him; there was no need for him to lower himself to meet a branch newcomer.

unless-

A lightning-fast thought flashed through Kiryu Yaya's mind.

Konosuke Nakajima heard something, or discovered something.

At this moment, his brain was working at lightning speed.

But faced with Yamada Masakazu's urging, Kiryu Yaya didn't have time to react much.

He quickly stood up, closed the notebook on the table, took the fountain pen that Ritsu Nishida had given him from the pen holder, and clipped it to the cover of the notebook.

The most conspicuous position.

This pen, which he acquired by chance, might just save his life when facing Managing Director Nakajima.

"Let's go, Section Chief."

Kiryu Yaya remained calm and spoke to Yamada Masakazu.

Masakazu Yamada, however, thought he was a little nervous, so he patted him on the shoulder and said, "Don't be nervous, he probably just wants to understand what happened back then."

Kiryu Yaya nodded, revealing a shy smile.

The two followed the familiar path to the fifth floor of the branch.

Managing Director Nakajima chose a small conference room at the end of the corridor on the fifth floor as his temporary base.

The door was half-open.

Masakazu Yamada stopped in front of the door and knocked twice for him.

"Managing Director Nakajima, Kiryu-kun has arrived."

"Please come in."

The voice of Konosuke Nakajima came from inside.

Masakazu Yamada turned to the side, gesturing for Yaya Kiryu to go in by himself.

Kiryu Yaya pushed open the door.

The reception room was small, about ten folds in size.

A dark-colored desk stood by the window, with several open folders spread out on its surface and a steaming teacup beside it.

His gaze fell upon Kiryu Yaya, paused for a moment, and then he revealed a kind smile: "Kiryu-kun."

"Yes."

Kiryu Yaya stopped about two steps away from the desk and bowed slightly.

"Managing Director Nakajima, you wanted to see me?"

Konosuke Nakajima did not respond immediately.

He leaned back in his chair, his gaze sweeping over him.

Then his gaze fell on the cover of the notebook, specifically on Ritsu Nishida's fountain pen.

Konosuke Nakajima looked at it for a few seconds, then spoke, his tone carrying a hint of something he hadn't said before: "Kiryu-kun, may I take a look at your pen?"

Kiryu Yaya paused for a moment, then looked down at the pen in his notebook and handed it over without hesitation.

Konosuke Nakajima took the pen but didn't speak immediately.

He first placed the pen in his palm, gently turned it, and then ran his fingers over the pen's body.

Although, he asked Kiryu Yaya, "Kiryu-kun, where did you get this pen?"

His tone sounded like a casual question, but Kiryu Yaya could tell that the other person's attention was completely focused on the pen.

"Reported to Managing Director Nakajima, this was given to me by Section Chief Nishida of the Finance Department at the Kyoto branch."

Konosuke Nakajima's fingers paused on the pen for a moment, then he looked up at him.

"Nishida Ritsu?"

"Yes."

Konosuke Nakajima gently placed the pen on the table, leaned back in his chair, and stared at Yaya Kiryu's face for a moment: "But I remember he was the head of the financing department at the Kyoto branch, right? How did this pen end up in your hands?"

Kiryu Yaya bowed slightly and briefly explained the matter of Fushimi Seiko.

At this moment, Konosuke Nakajima showed a look of sudden realization: "So that's how it is."

As he spoke, he chuckled softly: "So Section Chief Nishida really values ​​you, Kiryu-kun. Do you know who gave him this pen?"

A fleeting look of confusion crossed Kiryu Yaya's face, and he shook his head.

Konosuke Nakajima's gaze fell on the fountain pen, as if he were looking at an old object that carried many memories.

"This pen is a gift from me to him."

Kiryu Yaya's face showed a slight surprise: "This—"

Konosuke Nakajima slowly said, "Back when I was a section chief at the Kyoto branch, Nishida was under my command. He was meticulous and conscientious, and rarely made mistakes, big or small."

"At that time, I was about to be transferred from the branch to the head office, so I gave him this fountain pen that I had used for more than ten years."

"But I never expected to meet you again today."

Kiryu Yaya paused for two seconds, then bowed slightly: "Managing Director Nakajima, this pen—if it holds special sentimental value for you, please..."

"Need not."

Konosuke Nakajima raised his hand to interrupt him, his tone calm yet resolute.

"Once something is given away, it belongs to someone else. Since Ritsu Nishida gave it to you, it means he thinks you are worthy of it. If I take it back, it would be disrespectful to his judgment."

He gently pushed the pen back in front of Kiryu Yaya, then leaned back in his chair and adopted a more relaxed posture.

"Alright, now that we've finished talking about the pen, let's get down to business."

He rested his arms on the table, his fingers interlaced in front of him: "Kiryu-kun, I've already learned most of what's going on with Minister Furuta's case this morning."

"But there's one thing I've never understood."

"I heard that you have a special relationship with Ms. Miyazawa of the Miyazawa Group, so I would like to ask you to answer this question."

2

Kiryu Yaya bowed slightly: "Please speak, Managing Director Nakajima."

Konosuke Nakajima nodded and slowly said, "The land in Rinku City is the most valuable asset held by Miyazawa Tourism Development."

"Once the Kansai International Airport project is completed, the value of this land will continue to rise. Everyone in the Kansai business community knows this."

"But they still decided to sell. And it was approved by an overwhelming majority at the board level. Kiryu-kun, I want to know."

"Why is that?"

Before Kiryu Yaya could answer, Nakajima Konosuke rephrased the question: "Or to put it another way, I'd like to know, does this decision have anything to do with you?"

There was a moment of silence in the conference room.

Kiryu Yaya knew he couldn't avoid this question.

Konosuke Nakajima was no ordinary branch manager or department head; those who could reach his position possessed a political acumen far exceeding that of the average person.

Kiryu Yaya did not answer immediately.

He paused for a moment, as if to confirm whether what he was about to say was clear enough.

Then he looked up and met Konosuke Nakajima's gaze.

"Managing Director Nakajima, this decision is indeed related to me."

Konosuke Nakajima's eyebrows twitched slightly, but his expression didn't change much.

"President Miyazawa and I were high school classmates and have a good personal relationship."

"I had several in-depth conversations with her before the board meeting proposed the sale of Linkong City."

My suggestion at the time was one.

"Although the land value in Lingkong City is promising in the long term, the current financial situation and cash flow structure of the Gongze Group cannot support the realization of that long-term value."

He paused, then continued, "Instead of betting on an uncertain future, it's better to lock in a definite price in the present."

"With the 50 billion yen in hand, the Miyazawa Group will not only be able to resolve its current cash flow pressure in one go, but also leave ample room for the next step of restructuring."

Konosuke Nakajima listened quietly to him finish speaking, then asked, "So, it was you who suggested that President Miyazawa sell this land?"

"It was my suggestion."

Kiryu Yaya did not deny it: "But the final decision was made by President Miyazawa and the board of directors. I just explained the pros and cons."

"I see."

Konosuke Nakajima nodded slightly, his gaze fixed on Yaya Kiryu's face, as if trying to discern how much more he had left unsaid in his words.

"But I still have one question."

He leaned forward slightly, his voice carrying an unambiguous quality.

"Kiryu-kun, I know you've done a lot in the two months since you joined the company."

"Fuji Metals, Shiraishi Refrigeration, Miyazawa Group, Higashi-Osaka Seiko—each one was handled very well. This makes me think that you are not someone who makes judgments easily."

"But if, according to your logic, the goal is simply to ensure the Miyazawa Group has ample cash flow, then why not sell the less important land first, instead of prioritizing the sale of the most valuable plot in Rinko City?"

"What's your logic on this?"

Kiryu Yaya narrowed his eyes slightly.

It only takes a moment to think of this.

As expected, none of the people who can become the executive director of the head office are simpletons.

To be honest, the sense of oppression that Konosuke Nakajima exerted on him was much greater than that of Koudahiko.

Managing Director Nakajima is the epitome of a business elite and a political monster.

Kiryu Yaya could feel the other person's gaze resting on his face, calm and unhurried, yet carrying a focused intensity that was hard to ignore.

This is not a problem that can be solved by luck or coincidence.

He took a breath and then spoke.

"Managing Director Nakajima, you're right. If it's just to alleviate cash flow pressure, the Miyazawa Group could indeed sell some of its secondary assets first."

"For example, its several logistics sites along the Hanwa Line, or the Nanki Shirahama hot spring project that is still burning through money."

"These assets combined have a considerable book value, and the disposal period isn't long. If the Miyazawa Group is willing to sell them at a discount, they should be able to recoup around 10 billion yen."

"It's sufficient to handle the group's risks."

"9

He paused slightly.

"But I did not suggest that President Miyazawa take this path."

"Because in my personal judgment, land prices in Japan are very likely to experience an unprecedented plunge in the future."

"Based on this, I suggest that President Miyazawa make a move on Lin Kong City and cash out at a high price when the time is right."

Konosuke Nakajima's eyebrows twitched slightly: "You mean, you believe land prices will plummet?"

Kiryu Yaya nodded and said, "Yes, the Nikkei index has fallen by more than 40 percent from its peak at the beginning of last year."

"While commercial land prices in Tokyo and Osaka are still holding up, transaction volume has shrunk by nearly 60%."

"This is a typical signal that asset prices fall first, followed by a lagging response from the real economy."

"If land prices continue to decline, the first to be impacted will be bank credit lines secured by real estate."

"From this perspective, the 8 billion yen credit line for Miyazawa Tourism Development is ostensibly a debt of the Miyazawa Group, but in reality, it is already tied to the asset quality of Mitsubishi Bank."

"If the land in Lingkong City remains in the hands of the Gongze Group, the value of the collateral for the bank will shrink when the land price falls rapidly in the next round."

He paused for a moment, then added, "By then, it won't just be the Miyazawa Group that suffers losses, but also Mitsubishi Bank itself."

"7

The meeting room fell silent for a moment.

Konosuke Nakajima didn't reply, but he lowered his hands from the table and clasped them in front of his abdomen.

He nodded: "I think I understand your good intentions."

"But I have another question, which is that there are precedents for real estate price declines in Japanese history."

""

"In 1950 and 1960, there were signs of economic adjustment, but in the end, the crisis was averted due to timely government intervention and the stability of the banking system."

Why is it that this time, the Japanese economy couldn't weather the crisis and instead experienced a sharp decline?

Without a second thought, Kiryu Yaya said, "Managing Director Nakajima, you're right. Japan did indeed experience two economic adjustments in 1950 and 1961."

"At that time, land prices and stock prices also fell, and the banking system also experienced some credit crunches."

"But the adjustments made back then were fundamentally different from those made today."

"What's the difference?"

"scale."

"The adjustment in 1940 was a normal correction as the Japanese economy transitioned from a period of high-speed growth to a period of stable growth."

"The increase in land and stock prices is limited, and the ratio of bank loan balances to national savings is still within a controllable range."

"But this time is different."

"Since the Plaza Accord in 1985, the excess liquidity brought about by the appreciation of the yen, coupled with the government's financial liberalization policies, has caused the total amount of credit in the banking system to nearly double within five years."

"And most of this new credit went to real estate and the stock market."

"Commercial land prices in Tokyo have tripled in five years, and in Osaka they have doubled and a half."

"The Nikkei index reached 38,000 points at the end of 1989, more than double the level at the beginning of 1985."

"Managing Director Nakajima, if we use a ship as an analogy..."

"The adjustments in 1940 and 1950 were like storms; this adjustment will be a tsunami."

"Tsunami".

Konosuke Nakajima repeated the word, then said with a smile, "Kiryu-kun, your analogy is a bit of an exaggeration."

Kiryu Yaya did not avoid his gaze.

"Managing Director Nakajima, because in my opinion, the scale of this event truly deserves this analogy."

Konosuke Nakajima leaned back in his chair, his hands clasped in front of his abdomen, his gaze fixed on the pen on the table, as if he were thinking about something.

After nearly half a minute, he slowly spoke.

"Kiryu-kun, what you said does make some sense."

"but----"

"Your thinking is still too pessimistic."

He raised his eyes and looked at Kiryu Yaya. There was no contempt in his tone, but rather a calmness that had settled down after experiencing many cycles.

"I have worked in the banking industry for nearly forty years. I have experienced two major adjustments in the 40th and 50th years of the Showa era, and I have also witnessed the craziest period of the bubble economy."

"The market is always like this: when it's rising, you think it will rise forever; when it's falling, you think it will fall forever."

"But in fact, after each adjustment, the economy resumes growth."

"This time will be no exception."

He paused slightly as he said this.

"Of course, your logic is correct. Bubbles do exist, and adjustments are indeed taking place."

"But whether it will escalate into a tsunami-level collapse, as you described, I think it's too early to draw a conclusion."

He leaned back in his chair, his gaze falling on Kiryu Yaya's face, and his tone softened.

"I understand your logic in suggesting that the Miyazawa Group sell the Rinko City project, and I also understand your judgment on land price trends."

"But Kiryu-kun, you must understand that in the banking industry, there is an absolute chasm between pessimism and caution."

"Cautious people often go further than those who are simply optimistic or simply pessimistic."

Kiryu Yaya bowed slightly.

"I understand. This is just my personal opinion."

Konosuke Nakajima nodded and did not continue the topic.

He reached for his teacup, took a sip, and then casually added, "Kiryu-kun, I have another question, and I hope you will answer it truthfully as well."

Kiryu Yaya nodded.

Konosuke Nakajima's gaze fell on his face: "Is your involvement in Minister Kouda's arrest?"