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Other Measures

1. Measures to Support Financial Institutions' Efforts toward Strengthening the Foundations for Economic Growth and to Stimulate Bank Lending

(a) Measures to Support Strengthening the Foundations for Economic Growth

Through the fund-provisioning measure to support strengthening the foundations for economic growth, the Bank has provided long-term funds at a low interest rate to private financial institutions in accordance with their efforts in terms of lending and investment toward strengthening the foundations for economic growth.  The Bank offers four lines of credit to support, from the financial side, private financial institutions' efforts of their own accord toward strengthening the foundations for economic growth across a wide range of areas.  Through these measures, the Bank continues to make efforts as the central bank toward strengthening the growth potential of Japan's economy.

Table: Measures to Support Strengthening the Foundations for Economic Growth
  Main rules Special rules for equity investments and asset-based lending Special rules for small-lot investments and loans Special rules for the U.S. dollar lending arrangement
Time of establishment June 2010 June 2011 March 2012 April 2012
Total amount of loans 10 trillion yen 0.5 trillion yen 0.5 trillion yen 24 billion U.S. dollars
Eligible investments and loans Those with the size of 10 million yen or more Equity investments and ABL with the size of 1 million yen or more Those with the size of 1 million yen or more but less than 10 million yen Those denominated in foreign currencies with the size equivalent to 100 thousand U.S. dollars or more
Loan rates Fixed at 0.0 percent per annum for 4 years Note 1 6-month U.S. dollar LIBOR
Duration of loans 4 years (each year, counterparties have an option to make a prepayment) Note 2
  1. Note 1 As for loans initially disbursed on or before March 31, 2014, a loan rate of 0.0 percent is applied for the time being.
  2. Note 2 As for loans initially disbursed on or before March 31, 2014 and loans under special rules for the U.S. dollar lending arrangement, the duration of loans is 1 year, or 2 years for loans under special rules for equity investments and asset-based lending. The maximum overall duration of loans, including rollovers, is 4 years.

(b) Measures to Stimulate Bank Lending

Through the fund-provisioning measure to stimulate bank lending, the Bank provides long-term funds -- up to the amount that is twice as much as the net increase in lending -- at a low interest rate, without any limit, to financial institutions at their request, with a view to promoting their aggressive action and helping increase proactive credit demand of firms and households.

<Outline of the Stimulating Bank Lending Facility (Loans Initially Disbursed on or after April 1, 2014) Note>

  • The total amount of loans provided by the Bank and the amount of loans extended to each counterparty under this facility are unlimited.
  • Loans are disbursed on a quarterly basis based on the amount outstanding of lending in each quarter over the period of January-March 2014 to January-March 2018. The maximum amount of loans to each counterparty is the amount that is twice as much as the net increase in lending.
  • The duration of loans is 4 years. Each year, counterparties have an option to make a prepayment.
  • The interest rate on loans is fixed at 0.0 percent per annum for 4 years.

Note: As for loans initially disbursed on or before March 31, 2014, the treatment of the total amount of loans provided by the Bank and the amount of loans extended to each counterparty is the same as that laid out in the current outline. However, the terms and conditions applied to these loans differ as follows.

  • Loans are disbursed on a quarterly basis based on the amount outstanding of lending in each quarter over the period of January-March 2013 to October-December 2013. The maximum amount of loans to each counterparty is the amount equivalent to the net increase in lending.
  • The duration of loans is 1 year, 2 years, or 3 years, at the request of each counterparty. The maximum overall duration of loans, including rollovers, is 4 years.
  • The interest rate on loans is 0.0 percent per annum for the time being.

Further Information on the Scheme and Latest Loan Disbursement

2. Measures to Support Financial Institutions in Disaster Areas

Immediately after the Great East Japan Earthquake in March 2011, the Bank had taken swift measures, including ample liquidity provision and further enhancement of monetary easing, with a focus on three major aspects: maintaining the functioning of financial and settlement systems, ensuring the stability of financial markets, and supporting economic activity. In addition to such measures, the Bank conducts the funds-supplying operation to support financial institutions in disaster areas in order to provide financial support for these institutions' responses to the demand for funds for restoration and rebuilding. The Bank has also broadened the range of eligible collateral for money market operations with a view to ensuring that financial institutions in the disaster areas have sufficient financing capacity. Following the Kumamoto Earthquake in April 2016, the Bank has responded by taking various measures.

Further Information on the Scheme

For further information on the Bank's response after the Great East Japan Earthquake and the Kumamoto Earthquake, please see Releases Related to the Great East Japan Earthquake and Releases Related to the 2016 Kumamoto Earthquake.