Yosano eyes bigger role for DBJ, JBIC in helping troubled firms

TOKYO, Feb. 26 Kyodo - Finance Minister Kaoru Yosano said Thursday he expects the state-backed Development Bank of Japan and the Japan Bank for International Cooperation to play a bigger role in assisting embattled Japanese firms amid the global economic crisis.

''There are many areas in which we expect the DBJ and JBIC to work hard,''
Yosano told Kyodo News and other news organizations in an interview.
The just-privatized DBJ launched a program last December to buy up to 2
trillion yen in commercial paper, or short-term debts issued by companies, by
March 31 next year to support firms' fundraising activities.
JBIC, now under the wing of the government-owned public lender Japan Finance
Corp., has also set up an emergency program to provide loans and debt
guarantees for Japanese companies operating overseas that are having
fundraising trouble amid the rapidly worsening global credit conditions.
Yosano, who concurrently serves as financial services and economic and fiscal
policy minister, suggested that the government will study how to expand the two
lenders' functions in fighting the turmoil.
He said bolstering the roles of the DBJ and JBIC will not contradict the
government's policy of streamlining state-backed lenders, since they do not
compete with private-sector financial institutions in crisis responses.
Although he is known as a strong advocate of a sales tax increase to
rehabilitate Japan's heavily indebted fiscal position, Yosano indicated he now
prioritizes economy-boosting steps.
''I have never abandoned my goal of restoring fiscal health, but we face the
immediate economic crisis. We are asked what to do with time pressing,'' Yosano
said. ''We have to achieve both'' objectives of fiscal reconstruction and
economic stimulus, he added.
Yosano suggested that the government will consider an additional economic
package involving tax cuts, on top of the already announced steps worth 75
trillion yen in total, once the fiscal 2009 budget and related bills clear the
Diet.
On the health of Japan's financial system, he expressed a buoyant view, saying
he believes banks in the country are ''more resistant to stock plunges than we
all expect.''
''It's true that we hope stock prices will not fall, but (even if prices drop)
I think the Japanese financial system is not so weak,'' Yosano said.
Yosano said he is eager to utilize 12 trillion yen in public funds reserved for
injection into banks to boost their capital bases so that they can continue
lending.