JMGT_V2_N2_CS1 Jittima Tongurai Journal on Management 2230 – 715X 2 2 42 53 Postal savings system, Trust Fund Bureau, Fiscal Investment and Loan Program (FILP), FILP agencies The paper focuses on the reform of Japan’s postal savings system. Three major changes in the structure of the postal savings system after the reform include (i) the abolishment of postal savings’ compulsory deposits to the Trust Fund Bureau, (ii) the shift of Fiscal Investment and Loan Program’s fund allocation method from fiscal loan to bond issuance, and (iii) the reorganization and rationalization plan for special public corporation for more efficient utilization of public funds. Even though the reform is proceeding apace, the extent that postal savings invests in government, FILP, and FILP agency bonds, the deficiency of capability of self procurement of FILP agencies, and the increase in future financing needs of government as Japan approaches aging society are challenges to the success of the reform of postal savings system in Japan. In the era of globalization, privatization of government policy banks may occur in any developing countries. The experience of the reform of Japan's postal savings system provides a good case study that developing countries can learn from. September - November 2007 Copyright © 2007 i-manager publications. All rights reserved. i-manager Publications http://www.imanagerpublications.com/Article.aspx?ArticleId=351