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QuestionWhat kind of operations and services does the Bank provide to foreign central banks and international organizations?

Answer

Pursuant to Article 41 of the Bank of Japan Act, the Bank provides banking and custody services -- mainly the yen deposit service, as well as custody and liquidation services for Japanese government securities (JGSs) -- to foreign central banks and international organizations. These deposit accounts can be used for fund settlement in currency swap transactions between the Bank and foreign central banks. Also, foreign central banks may use their accounts for accepting JGSs and yen funds as collateral from counterpart financial institutions.

Banking and Custody Services

1. Deposit Service

The Bank accepts yen deposits from overseas account holders, and settles funds according to their instructions.

For details, see Principal Terms and Conditions concerning the Operation of Yen Accounts for Foreign Central Banks and International Organizations.

2. Custody Service

The Bank keeps records of JGSs for overseas account holders, deals with their settlement instructions, and manages the principal and interest payments of those securities.

For details, see Principal Terms and Conditions concerning the Operation of Securities Custody Accounts (S) for Foreign Central Banks and International Organizations.

3. Liquidation Service

When overseas account holders have a sudden need to raise yen funds, the Bank may purchase their JGSs at their request, either with or without repurchase agreements.

For details, see Principal Terms and Conditions concerning Outright Purchases and Purchases under Resale Agreements of JGSs from Foreign Central Banks.

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