TOKYO Aug 23 Government debt held by large
Japanese banks as of end June fell to its lowest level since
March 2010, data released on Friday by the Bank of Japan showed,
suggesting that the central bank's effort to increase lending
may be showing some signs of success.
According to the data large Japanese banks, known as "mega
banks," held 85.86 trillion yen ($870.75 billion) of Japanese
government debt at the end of June, declining 7.4 percent from a
The BOJ, as part of a very loose monetary policy aimed at
reinvigorating the economy, has been trying to nudge banks away
from assets like government debt and into riskier assets like
foreign stocks. The central bank also wants banks to increase
lending, using money parked in bonds.
"Bank lending is increasing, but considering that their
holdings of foreign stocks have also declined, it is too early
to say that the rebalancing of bank portfolios the BOJ would
like to see is fully on track," said Teruyoshi Saotome, a senior
bond strategist at Mizuho Securities.