MNI POLICY: BOJ Kuroda: Credit Costs Won't Affect Fnc'l System

     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda said on Tuesday that

currently the risk is small that rising credit costs triggered by the spread of

the coronavirus will affect the nation's financial system.

     Kuroda told lawmakers that commercial banks, including regional banks, have

sufficient capital bases. although he added, "If the coronavirus outbreak is

prolonged, it will further increase credit costs (at banks), which in turn will

affect the financial system. The risk isn't big, but the BOJ continues carefully

examining future moves."

     Kuroda also said that Japan's economy will remain in a severe condition as

the virus spreads, saying the BOJ will not hesitate to take additional easy

policy if needed.

     He added that expanding the current policy framework, increasing the asset

purchases and lowering short- and long-term policy interest rates are future

option, although he did not elaborate.

     The BOJ will continue to make efforts to maintain the stability in

financial markets and to facilitate corporate financing, Kuroda said, adding

that the BOJ needs to maintain accommodative easy policy until the achievement

of the 2% price target.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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