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Principal Terms and Conditions for Funds-Supplying Operations against Pooled Collateral Conducted through the Asset Purchase Program (Invalid)

October 28, 2010

Revision:July 12, 2012
January 22, 2013

1. Purpose

The terms and conditions prescribe the principles for the Bank of Japan's funds-supplying operations against pooled collateral (loans that are made against pooled collateral by way of open market operations) conducted through the Asset Purchase Program set forth in the "Principal Terms and Conditions for the Asset Purchase Program" (Policy Board Decision on October 28, 2010).

2. Application

The terms and conditions shall apply to the funds-supplying operations against pooled collateral conducted through the Asset Purchase Program, notwithstanding the "Principal Terms and Conditions for Funds-Supplying Operations against Pooled Collateral" (Policy Board Decision on April 11, 2006).

3. Location of Operations

The Bank's Head Office (Operations Department) or its branches.

4. Eligible Counterparties

Eligible counterparties shall, pursuant to the relevant rules of the Bank, be selected from financial institutions (as defined in Article 37, Paragraph 1 of the Bank of Japan Act, Act No. 89, 1997, excluding the Resolution and Collection Corporation and bridge banks [as defined in Article 2, Paragraph 13 of the Deposit Insurance Act, Act No. 34, 1971]), financial instruments firms (Article 10, Paragraph 1, Clause 2 of the Bank of Japan Act Enforcement Order [Order No. 385 of 1997]) that conduct the first financial instruments business (Article 28, Paragraph 1 of the Financial Instruments and Exchange Act, Act No. 25, 1948), securities finance companies (Article 10, Paragraph 1, Clause 3 of the Order), and tanshi companies (Article 10, Paragraph 1, Clause 4 of the Order).

5. Form of Loans

Loans shall be provided in the form of electronic lending.

6. Duration of Loans

The maximum duration of each loan shall be about 6 months.

7. Loan Rates and Collection of Interest

(1) Interest Rates on the Loans

The interest rate shall be 0.1 percent per annum.

(2) Collection of Interest

The interest on a loan shall be calculated based on the rate stipulated in (1) for the number of days from the first day after the disbursement of the loan up to the maturity date, and the interest shall be collected after the loan reaches maturity.

8. Maximum Amount of Loan

The maximum outstanding amount of loans shall be as prescribed in paragraph 4. of the "Principal Terms and Conditions for the Asset Purchase Program."

9. Date of Loan Disbursement, Amount of Loans, etc.

Taking into account conditions in financial markets, the Bank shall determine, at each operation, necessary specifications, including dates of loan disbursement, amount of loans, and counterparties.

10. Collateral

  1. (1) The Bank shall accept eligible collateral from counterparties in advance.
  2. (2) The "Guidelines on Eligible Collateral" (Policy Board Decision on October 13, 2000) and the "Collateral Guidelines on Eligible Foreign Bonds" (Policy Board Decision on May 22, 2009) shall apply to the collateral for the loans.

Supplementary Provision

  1. These terms and conditions shall become effective today.
  2. The outstanding amount of loans disbursed pursuant to paragraph 6. (1) (b) of the "Principal Terms and Conditions for Funds-Supplying Operations against Pooled Collateral" on the effective date of the terms and conditions provided herein shall be deemed as the outstanding amount of loans disbursed pursuant to the terms and conditions provided herein from the effective date above.