Kuroda Surprise Poses $250 Billion Question for Japanese Banks
- Banks must determine how to offset 0.1% fee on some reserves
- Expanding loans, buying securities are among the options
BOJ's Kuroda Surprises With Negative-Rate Strategy
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The Bank of Japan’s surprise decision to start charging lenders for as much as 30 trillion yen ($250 billion) of deposits they have parked with it has left them with a quandary: what else to do with all that cash?
When Governor Haruhiko Kuroda’s policy takes effect on Feb. 16, the 0.1 percent negative rate will probably apply to about 10 trillion yen to 30 trillion yen of funds held in current accounts at the BOJ, according to people with knowledge of the matter.