The government completed procedures Monday to seize all shares in Ashikaga Bank and temporarily nationalize the insolvent regional lender.
The Bank of Japan responded by telling financial institutions it would inject 1 trillion yen into the short-term money market to shield the banking system from the impact of Saturday's government decision to nationalize the bank, money market sources said.
The BOJ will provide the additional liquidity to the market through the imminent purchase of securities held by the institutions, the sources said.