The Bank of Japan said Tuesday it will provide additional interest on the balance of current account deposits held by regional lenders at the central bank if they reorganize in response to impacts of the novel coronavirus or reduce their overheads.
Under the three-year program through fiscal 2022, regional banks and smaller, community-focused shinkin banks will receive an additional 0.1% interest on their current account balances if they decide to merge with others or integrate their businesses.
The new program is in line with Prime Minister Yoshihide Suga's call for regional banks to reorganize. Suga has said there are too many such lenders in a rapidly graying Japan.