The Financial Services Agency (FSA) will ease rules on corporations’ purchase of their own stocks as part of its efforts to lessen downward pressure on Japanese stock prices due to the global financial crisis. The change in the rules, which will reportedly last from Tuesday, 14 October until 31 December will include measures such as raising the maximum number of its own stocks a company can buy each day.
In the same statement, the FSA also says that it will implement a suspension in the sale of public sector-owned stocks in order to give additional relief to stock prices, and that it will request the Bank of Japan (BOJ) to do the same. As of 31 March, the government reportedly had about JPY 500 billion in shares in domestic financial institutions, while the BOJ had about JPY 1.4 trillion. They bought the shares between 2002 and 2006 in order to ease the impact of the domestic financial crisis that was affecting Japan at that time.
Among other initiatives, the FSA announced that it will enhance its monitoring of short selling on the securities exchanges, and that it will take necessary measures when acting on the information it receives.
D.C.