Moreover, by reducing the allocation of capital to stock price volatility, banks can free up some of their capital to support firms. It is worth noting that banks have made steady progress in reducing their exposure to stock price fluctuations. In fact, the total shareholdings of banks fell by 48 percent to 21 trillion yen over the past two years.
To support the efforts of banks, the Bank started purchasing stocks held by them in November 2002. The total value of stocks purchased by the Bank amounts to 1.8 trillion yen to date, and in September, the Bank decided to extend the stock purchasing period by one year. Needless to say, the market should be the place in which stocks are traded.