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Mitsubishi UFJ Financial Group Inc. plans to issue a corporate bond to raise funds for measures against the coronavirus, according to informed sources.

It will be the first “coronavirus bond” in Japan, the sources said.

MUFG aims to raise some ¥60 billion through the bond, which could be issued as early as June.

The proceeds will be used to extend loans to financially struggling small businesses and help the development of coronavirus vaccines, the sources said.

The instrument will be a sustainability bond whose proceeds go exclusively to programs to tackle the environmental and social issues.

The megabank group also aims to utilize the funds from the bond for loans related to renewable energy projects.

MUFG hopes to lure funds by highlighting its active involvement in resolving social issues at a time when ESG investment, or investment in companies with strong environmental, social and corporate governance principles, is drawing investor attention.

Plunging demand due to the coronavirus crisis has left many small businesses strapped for money.

The government has started providing a cash grant of up to ¥2 million to small companies whose sales have fallen 50 percent or more year on year.

The Bank of Japan is considering a new fund-supply measure through cooperation with the government, on top of a special operation aimed at facilitating corporate financing.

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