BOJ offers $ 78 billion to businesses affected by pandemic in first phase of loan program

FILE PHOTO: A man wearing a protective mask walks past the Bank of Japan headquarters amid the coronavirus disease (COVID-19) outbreak in Tokyo, Japan May 22, 2020.REUTERS / Kim Kyung- Hoon

TOKYO (Reuters) – The Bank of Japan on Wednesday offered 8.28 trillion yen ($ 77.74 billion) in loans to financial institutions as part of a new loan program to channel funds to businesses in cash strapped hit by the coronavirus pandemic.

The three-month loans will be extended Thursday until December 25, the central bank said.

Wednesday’s market operation was the first to be offered since the BOJ combined several facilities in May to create a single loan program aimed at injecting cash into pandemic-affected businesses through financial institutions.

The central bank has said it expects the amount of money to be pumped through the program to eventually reach 110 trillion yen.

The BOJ eased monetary policy in March and April, pledging to buy more assets, gobble up unlimited amounts of public debt, and create loan facilities to funnel money to businesses.

The number of participants increased from 18 in March to 180, after the BOJ decided to pay 0.1% interest to financial institutions that used the program, effectively subsidizing them to take loans from the central bank.

Reporting by Leika Kihara; Editing by Jacqueline Wong

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