TOKYO (Kyodo) — The Bank of Japan has completed the disposal of stocks it bought from financial institutions from 2002 to calm markets and safeguard the banking system, official data showed Monday.
The bank had resumed selling the shares in 2016 amid fading financial concerns as it sought to wind up a measure it had described as “extraordinary” for a central bank. It carried out monetary stimulus for more than two decades to prop up Japan’s deflation-hit economy.
As of June 30, the BOJ held about 2.54 billion yen ($17 million) in stocks managed under a trust arrangement. The entry, however, no longer appeared in the latest data, with attention now turning to when it will start selling other securities.
In an unprecedented move for a central bank, the BOJ began buying stocks from commercial banks in 2002 to protect their earnings from market downturns, as lenders struggled with bad loans after an asset bubble burst in the early 1990s, fanning fears over financial stability.
The BOJ began offloading the shares in 2007 but suspended sales in 2008 as the global financial crisis hit. It briefly resumed buying for two years through 2010 to support the market, before restarting asset sales in 2016.