Economy, Trade and Industry Minister Takeo Hiranuma responded cautiously Friday to the Tokyo Metropolitan Government's plan to create a bank to fund small and midsize firms.

"We have yet to know the details of the plan, but generally speaking, there are many issues to be studied further," Hiranuma said.

Tokyo Gov. Shintaro Ishihara said Thursday the metropolitan government will establish a bank that will have no bad loans and provide ample credit to small and midsize firms.

Hiranuma said he has some concerns, such as how the bank will assess and bear risks, whether the metropolitan government will seek public funds to set it up and the relationship between the new bank and commercial banks.

Hiranuma said he wants to discuss the matter with the Tokyo government, saying facilitating financing for small and midsize firms is one of the most important tasks facing the Economy, Trade and Industry Ministry.

At a separate press conference, Finance Minister Masajuro Shiokawa said he believes the metropolitan government's plan is "an interesting idea" that could serve as a catalyst to inject new vigor into the banking sector. "A financial institution designed for the local community is an interesting idea," he said. "What the financial institutions need is stimulus," and the plan could provide that.

Toranosuke Katayama, minister of public management, home affairs, posts and telecommunications, called on regional governments not to follow Tokyo's lead too quickly. "It may be possible for Tokyo, but such a plan would not always be possible for regional governments," he said.

He said he finds the idea "interesting personally," but there are many points that need to be discussed before the new bank is launched.