The Bank of Japan finished selling millions of dollars of stocks it bought from besieged banks during a domestic banking crisis in the early 2000s and the later Lehman Shock, ending a nearly two decade process and bringing closer market attention to the fate of its much bigger pile of exchange-traded funds.
The BOJ’s holdings of the shares purchased from banks hit zero as of July 10, falling from ¥2.5 billion ($17.4 million) 10 days ago, according to its balance sheet report Monday. It’s well ahead of a self-imposed deadline of March next year, although the milestone was expected to happen around this time after a steady drop of roughly ¥10 billion per month in recent years.
The offloading of the shares suggest that the BOJ’s normalization process more broadly could be accomplished without disrupting financial markets, although it would take a considerable amount of time. The assets were originally bought as a crisis response measure, years before the introduction of the massive monetary easing program that Gov. Kazuo Ueda’s board is now in the process of unwinding.
