Financial intermediation can be judged as being functioning smoothly, as evidenced by the fact that financial institutions have been maintaining capital bases that are adequate to meet  7  firms' demand for funds, and that the Tankan surveys have shown favorable levels both in terms of lending attitudes among financial institutions and the financial positions of firms (Chart 17).
Another side effect involves productivity. Some suggest that prolonged, large-scale monetary easing has led to continuation of less productive investments and businesses, and furthermore allowed firms that otherwise should have been withdrawn from the market to keep operating, thereby causing delay in economic structural reforms and adversely affecting productivity.