Future Cash Flow Support for Companies
(Statement by Mr. Aso, Minister for Financial Services)

  The central government decided the second supplementary budget today to further strengthen cash flow support for SMEs and small companies and medium-sized and large companies to offer reassurance to them.

  We have requested private financial institutions to meticulously ascertain companies' business conditions and make utmost efforts to avoid serious hindrance to their cash management.
  However, the impact of COVID-19 infection on the economy is significant and it is highly likely that considerable time will be required for the economy to restore truly sound conditions. Under such circumstances, private financial institutions' proper loans are expected to play significant roles, in addition to government financial institutions' loans and private financial institutions' loans guaranteed by Credit Guarantee Corporations. Financial institutions are requested to remain vigilant and continue providing cash flow support for companies carefully and promptly.

  From the perspective of securing continued cash flow support, the FSA requests private financial institutions to note the following:
  1. The FSA respects financial institutions' decisions to maintain previous evaluations regarding customers that they had recognized as being financially sound before the spread of COVID-19 infection.
  2. We will analyze the balances of private financial institutions' proper loans and conduct hearings concerning the status of their cash flow support for companies, such as whether loan balances are decreasing or not, while referring to loans and guarantees provided by government financial institutions, etc.
  3. Active use of borrowings recognizable as capital (borrowed money that is deemed to have the nature of capital through the evaluation of the borrower and that can be treated as capital) is recommendable and we will clearly indicate this in the Guidelines for Supervision.

  We will continuously endeavor to properly offer cash flow support for companies affected by COVID-19 infection.

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