The ruling Liberal Democratic Party and its junior coalition partner, New Komeito, have agreed to study new measures to boost stock prices before the March 31 book-closing of the current fiscal year, senior coalition lawmakers said Wednesday.
The accord, which came after the key Nikkei stock index briefly fell below a 26-year closing low Tuesday, was reached earlier in the day during a meeting of the secretaries general and other executives of the two parties.
The Banks' Shareholdings Purchase Corp., a public entity founded in 2002, is set to resume purchasing shares subjected to cross-holdings between banks and their customer corporations under a bill that is planned to clear the Diet early next month.
The ruling bloc and government are planning to attach to the bill a resolution calling for expanding the range of shares for purchase by the corporation and will submit a bill for the expansion promptly.
"We will have the pending bills passed into law quickly," LDP Secretary General Hiroyuki Hosoda told reporters after reaching the agreement with his New Komeito counterpart, Kazuo Kitagawa. "Further financial and stock market measures should be taken. We will draft bills if necessary."
The corporation is planning to use a ¥20 trillion credit guarantee facility put into the second supplementary budget for fiscal 2008 that was enacted earlier.
The range of shares for purchase by the corporation may be expanded to cover all shares and even exchange-traded funds.
The ruling parties' accord follows a recent proposal by Fujio Mitarai, chairman of the Japan Business Federation (Nippon Keidanren), the nation's largest business lobby, to create a public organization to purchase stocks.
On Tuesday, Finance Minister Kaoru Yosano said the government would consider taking measures to stem faltering stock prices.