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Establishment of Principal Terms and Conditions for the Outright Purchases of Asset-Backed Securities

The correction below has been made to reflect the Japanese original more accurately. The original Japanese text, however, remains entirely unchanged (January 14, 2004).

Attachment 1, Item 4 (2) (b), Ratio of assets related to small and mediam-sized enterprises
(Previous version) enterprises with capital of 1 billion yen or less
(New version) enterprises with capital of less than 1 billion yen

June 25, 2003
Bank of Japan

At the Monetary Policy Meeting (MPM) held today, the Policy Board of the Bank of Japan decided to establish Principal Terms and Conditions for the Outright Purchases of Asset-Backed Securities. The Bank aims to promote smooth corporate financing by encouraging the development of asset-backed securities (ABSs) market and to strengthen the transmission mechanism of monetary easing.

These terms and conditions prescribe the principles for the Bank's outright purchases of ABSs based on "Outline of the Outright Purchase Scheme for Asset-Backed Securities", which was decided at the MPM held on June 10-11, 2003.

The Bank also decided to extend the effective period of the temporary measure to accept a broader range of asset-backed commercial paper as eligible collateral, which was decided at the MPM held on December 16-17, 2002, for 1 more year until end-March 2006, the expiration date of the outright purchases of ABSs (Temporary Rules of Eligibility Standards for Asset-backed Commercial Paper and Dematerialized Asset-backed Commercial Paper were amended.).

Regarding the full text of Principal Terms and Conditions for the Outright Purchases of Asset-Backed Securities and the amended text of Temporary Rules of Eligibility Standards for Asset-backed Commercial Paper and Dematerialized Asset-backed Commercial Paper, seeAttachment 1(PDF, 30KB) and 2 respectively.

Attachment2

Amendment to Temporary Rules of Eligibility Standards for Asset-backed
Commercial Paper and Dematerialized Asset-backed Commercial Paper

  • Paragraph 3. shall be amended as follows.

3. These rules shall become effective on the date designated by the Governor, which shall be no later than January 31, 2003. The rules shall be abolished at the end of March 20052006.

(Supplementary Provision)

This amendment shall become effective on June 25, 2003.