Members of the Bank of Japan Policy Board indicated during their September meeting that the central bank needs to reduce financial institutions' exposure to the stock market, according to minutes of the meeting released Tuesday.
One member went so far as to say the BOJ should stabilize the financial system "even if these measures cause a certain degree of risk to the central bank," the minutes say.
According to the minutes, the members "pointed out that one of the reasons why Japan needs to be more cautious than other countries about the effects of stock price falls on the economy is that Japanese financial institutions hold a large amount of stocks and thus the financial system is vulnerable to stock price volatility."