The Bank of Japan is teaming up with the government and financial institutions on a plan that will offer small and midsize companies a new fundraising channel, BOJ Gov. Toshihiko Fukui said Friday.
The plan, which could be launched Monday, will involve securitizing the accounts receivable of companies that take part, Fukui told the House of Councilors Budget Committee.
Under the plan, the central bank will target in its outright operations about 1 billion yen worth of asset-backed commercial paper, using the securitized accounts receivable as collateral, BOJ officials said.
Shoko Chukin Bank, a government-affiliated lender, will obtain the accounts receivable issued through Mizuho Trust & Banking Co. and other parties.
Financial experts said this will be the first commercial paper in Japan to be backed exclusively by the loan claims of small and midsize firms.
Quizzed by a ruling party lawmaker over the proposal, Fukui said, "The measure is important in view of ensuring monetary policy . . . and enabling small and midsize companies to raise funds."
Fukui said the BOJ may ask the government to submit legislation connected with promoting the plan.
The BOJ will consult with government-run financial institutions and the Small and Medium Enterprise Agency over how to promote the securitization of accounts receivable, such as providing government guarantees for the commercial paper involved, the officials said.