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To: yard_man who wrote (15993)	7/12/1998 8:44:00 AM
From: Link Lady	Read Replies (1) \| Respond to of 18056

Comments on following. Anyone speculate on how market will accept this. 07/12 3:24A (DJ) Japan To Propose Asian Yen Loan System Using JGBs: Nikkei TOKYO (Nikkei)--The Bank of Japan will introduce a system of providing yen-denominated loans to other central banks, mainly in Asia, using Japanese government bonds held by those institutions as collateral, the Sunday edition of the Nihon Keizai Shimbun reports. The newspaper quotes BOJ sources as saying the move is primarily designed to help other Asian countries ease liquidity problems and stabilize their financial systems. It is also aimed at promoting internationalization of the Japanese currency. The BOJ will propose the idea at meetings in Tokyo of the Bank for International Settlements on Monday and the East Asian and Pacific Central Bankers (EMEAP) on Tuesday. The system envisages a 'repo' formula under which a foreign central bank would sell its Japanese government bonds to the BOJ under a repurchase agreement, in exchange for which the BOJ would loan yen to that central bank. The BOJ initially plans to conclude bilateral agreements on the system with central banks in China, Hong Kong and Singapore, the sources said. It hopes to ink similar accords with other central banks by end-1998. The BOJ already has similar agreements with other Asian central banks in regard to dollar loans, but this would be the first time it adopted them for yen lending. (E