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Aso asks banks to support business lending

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Japanese Finance Minister Taro Aso said he had asked bank leaders on Monday to support lending to businesses to ease concerns over the economic impact of the coronavirus pandemic.

“I requested both public and private banks to make absolutely sure to support financing to corporations,” Aso told reporters after meeting senior bank officials. Liquidity was not, however, being squeezed as much it had during the financial crisis a decade earlier, he added.

Aso’s comments came after The Bank of Japan eased monetary policy on Monday by pledging to buy risky assets such as exchange-traded funds (ETF) at double the current pace, joining global central banks in combating the widening economic fallout form the coronavirus epidemic.

The central bank also decided to create a new loan program to extend one-year, zero-rate loans to financial institutions in an effort to boost lending to firms hit by the virus outbreak.

© Thomson Reuters 2020.

©2020 GPlusMedia Inc.

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Banks already support big chunks of the zombie economy.  Free money is part of the problem as much as it is a stopgap measure to assist some companies.

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