Hashimoto orders steps for raising land liquidity

Prime Minister Ryutaro Hashimoto on Mar. 18 instructed Finance Minister Hiroshi Mitsuzuka to draw up by the end of the month comprehensive measures to increase the liquidity of land held as collateral for loans.

The package was expected to include such measures as securitization of collateralized real estate and specific steps to encourage more use of such land by municipal governments. Measures to raise the value of small land plots in urban areas left undeveloped after the bubble economy of the late 1980s will also be included.

Mitsuzuka expressed hope at a news conference that the plan has a favorable effect on stock prices as the fiscal year ends March 31, adding that increased land liquidity would spur financial institutions to dispose of their nonperforming loans. “A comprehensive liquidation package should be attempted at this time, because land prices have become stable,” the finance chief added.