The Tokyo Metropolitan Government plans to launch a new bank, to be capitalized at 150 billion yen, in fiscal 2004 to provide funds to small and midsize companies, officials said Thursday.
A draft plan to set up the bank, as Gov. Shintaro Ishihara pledged to do in his second term, will be announced as early as Friday, the officials said.
Under the plan, the first bank to be established by a local government will extend loans primarily to small and midsize firms that have advanced technologies but are unable to raise funds due to shortage of assets for use as collateral.
The metro government will provide 100 billion yen in capital to the bank, while the remaining 50 billion yen will be collected from private companies and other concerned parties.
More than 10 financial and other businesses, including East Japan Railway Co., are expected to contribute capital to the bank.
In addition to lending, the bank will accept ordinary deposits, with total deposits expected to reach 2 trillion yen.
Financial Services Minister Heizo Takenaka welcomed the plan, saying that new banks will contribute to the development of the industry.