BOJ Amamiya: new bank aid wouldn’t affect market interest rates

BOJ Amamiya: new bank aid wouldn’t affect market interest rates

© Reuters. Bank of Japan Deputy Governor Masayoshi Amamiya speaks during a Reuters Newsmaker event in Tokyo

TOKYO (Reuters) – Bank of Japan Deputy Governor Masayoshi Amamiya on Wednesday said he wanted to launch a new scheme to strengthen the regional financial system “as quickly as possible” while brushing aside concern that it might affect market interest rates.

The central bank last month unveiled a plan to pay 0.1% interest on deposits held by lenders that cut costs, boost profits or consolidate, as COVID-19 adds pain to regional banks suffering from years of ultra-low interest rates.

“The chance is very low” that a new system to strengthen regional finances would affect interest rate formation in the market as a whole, Amamiya told an online news conference held after a virtual meeting with business leaders in Akita, northern Japan.

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