A rate control unit performs data truncation on a code sequence having been sorted and bit shifted as shown in FIG. 10 so that a desired noise reduction effect is achieved. The data truncation occurs in sequence from the rightmost bit. For example, in FIG. 10, data is truncated from data of bit 0 in a subband VHL4 downwardly in sequence through data of bit 0 in a subband YHH5, and so on. If the desired noise reduction effect can be achieved by truncation of up to bit data in the subband YHH1, data in those subbands in a dotted area in FIG. 10 will be truncated. If the desired noise reduction effect cannot be achieved by truncation of up to bit data in the subband YHH1, data will then be truncated from data of bit 0 in a subband VLL4 downwardly in sequence.