As the Bank continues to purchase JGBs, the current account balances will increase accordingly; however, since the tier will be adjusted at the same time, the balances subject to a negative interest rate will remain relatively small, between around 10 and 30 trillion yen.
Needless to say, the Bank will closely monitor the effects on financial institutions’ earnings, and will examine and evaluate those effects in the Financial System Report. The importance of banks’ functioning as financial intermediaries in the transmission of monetary policy cannot be overemphasized.