ID :
23833
Sat, 10/11/2008 - 08:59
Auther :
Shortlink :
https://oananews.org//node/23833
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Adequate capital base vital to restore market stability: BOJ chief
WASHINGTON, Oct. 10 Kyodo - Bank of Japan Governor Masaaki Shirakawa said Thursday it is vital for financial institutions to keep adequate capital bases for their smooth financial intermediation, alluding to the need for the U.S. government to use public money to recapitalize the country's ailing financial bodies.
''Smooth financial intermediation is indispensable for economic growth. If the
self-owned capital of financial bodies is insufficient, those entities will not
be able to take risks,'' Shirakawa told reporters in Washington.
The BOJ chief said he and Japanese Finance Minister Shoichi Nakagawa will refer
to Japan's experience of public fund injection into its beleaguered banks in
the late 1990s and early 2000s during the one-day Group of Seven meeting Friday
in the U.S. capital.
''Japan eventually used government money to tackle its own financial crisis.
Our experience might not be useful immediately because underlying conditions
are different, but there may be some areas we can share,'' Shirakawa said.
U.S. Treasury Secretary Henry Paulson is ''actively considering'' ways to
infuse public money into embattled U.S. financial institutions to shore up
their capital bases and contain the deepening global financial mayhem, the
White House said Thursday.
Finance ministers and central bank governors from Britain, Canada, France,
Germany, Italy, Japan and the United States are widely anticipated to note the
importance of boosting financial entities' capital bases during their meeting
Friday afternoon.
Shirakawa said tension in the global financial markets has been rising amid the
current turmoil and that the G-7 nations will strive to carry out steps to
restore stability in the financial sector and the world economy as soon as
possible.
The BOJ chief also said that the Japanese bank did not take part in a joint
interest rate cut of 0.5 percentage point Wednesday by six central banks,
because the nation's financial markets had been ''relatively stable'' compared
with those of the United States and Europe.
Shirakawa also said Japan's credit conditions are already accommodative as the
BOJ's key short-term interest rate has been kept at 0.5 percent.
The BOJ governor met with Federal Reserve Chairman Ben Bernanke, European
Central Bank President Jean-Claude Trichet and International Monetary Fund
Managing Director Dominique Strauss-Kahn on the eve of the one-day G-7
gathering to discuss the current global economic and financial conditions.
==Kyodo
''Smooth financial intermediation is indispensable for economic growth. If the
self-owned capital of financial bodies is insufficient, those entities will not
be able to take risks,'' Shirakawa told reporters in Washington.
The BOJ chief said he and Japanese Finance Minister Shoichi Nakagawa will refer
to Japan's experience of public fund injection into its beleaguered banks in
the late 1990s and early 2000s during the one-day Group of Seven meeting Friday
in the U.S. capital.
''Japan eventually used government money to tackle its own financial crisis.
Our experience might not be useful immediately because underlying conditions
are different, but there may be some areas we can share,'' Shirakawa said.
U.S. Treasury Secretary Henry Paulson is ''actively considering'' ways to
infuse public money into embattled U.S. financial institutions to shore up
their capital bases and contain the deepening global financial mayhem, the
White House said Thursday.
Finance ministers and central bank governors from Britain, Canada, France,
Germany, Italy, Japan and the United States are widely anticipated to note the
importance of boosting financial entities' capital bases during their meeting
Friday afternoon.
Shirakawa said tension in the global financial markets has been rising amid the
current turmoil and that the G-7 nations will strive to carry out steps to
restore stability in the financial sector and the world economy as soon as
possible.
The BOJ chief also said that the Japanese bank did not take part in a joint
interest rate cut of 0.5 percentage point Wednesday by six central banks,
because the nation's financial markets had been ''relatively stable'' compared
with those of the United States and Europe.
Shirakawa also said Japan's credit conditions are already accommodative as the
BOJ's key short-term interest rate has been kept at 0.5 percent.
The BOJ governor met with Federal Reserve Chairman Ben Bernanke, European
Central Bank President Jean-Claude Trichet and International Monetary Fund
Managing Director Dominique Strauss-Kahn on the eve of the one-day G-7
gathering to discuss the current global economic and financial conditions.
==Kyodo
