Following the Cabinet Order for Amendment of Part of the Enforcement Order of the Japan Finance Corporation Act approved by the Cabinet on December 26, 2008, JBIC has launched a financing facility that provides loans and guarantees for Japanese firms to finance their business operations in industrial countries, as an exceptional measure in its effort to support Japanese industries for maintaining international competitiveness in response to the global financial turmoil.
The operations eligible for this exceptional measure were defined by the above Order as: "those business operations determined by the competent minister to belong to the industries that are experiencing significant difficulties in promoting the government policy of maintaining their international competitiveness due to the global financial turmoil after September 2008." The eligible business operations were designated below by the public notice issued by the Ministry of Finance on January 27, 2009. This facility is a temporary measure to be terminated at the end of March 2010.
Eligible Business Operations
The business operations that meet the following conditions are eligible for the facility:
- Business operations being conducted by Japanese firms or its local subsidiaries and affiliates in the regions other than developing countries as of January 27, 2009.
- Business operations that are facing significant difficulties in direct or indirect funding either through issuance of corporate bonds and other securities or through borrowing from banks, as a result of the global financial turmoil since September 2008.
Overview of the Facility
Loans and guarantees for Japanese firms to finance their business operations in industrial countries.
- (1) Eligible borrower: Japanese and their overseas subsidiaries and affiliates conducting business operations in industrial countries*1
- (2) Country coverage: Australia, New Zealand, the U.S., Canada, Ireland, Italy, Austria, Netherlands, Greece, United Kingdom, Switzerland, Sweden, Spain, Denmark, Germany, Norway, Finland, France, Belgium, Portugal, Luxemburg, and Iceland
- (3) Co-financing: Loans are extended in co-financing with private banks. JBIC will lend a maximum of 60% of the total co-financed amount. (In the case of small and medium enterprise (SMEs), a maximum of 70%.)
- (4) Interest Rate: Interest rate of JBIC will not be below the rate of co-financing private banks
- (5) Maturity: 1 to 5 years. Maturity less than 1 year is not eligible.
- (6) Use of Guarantee: JBIC will actively make greater use of guarantees to meet the needs of business operations.
- (7) Schematic Illustration
For typical business operations eligible under the facility, please see here.
*1 Note: JBIC has been able to provide direct loans and guarantees for domestic firms to finance their business operations in developing countries. JBIC has also been able to provide loans and guarantees for domestic firms to finance their projects that help secure a stable supply of resources to Japan (including acquisition of interests in resource development) and projects undertaken by domestic mid-tier firms and small and medium enterprises in developing countries.
This exceptional measure enables JBIC to provide loans and guarantees for business operations conducted by Japanese firms in industrial countries as well.
Aside from this facility, JBIC has launched the following facilities as part of its efforts to cope with the global financial turmoil:
- (i) Supplier's credit (S/C) for exports to developing countries
- (ii) Loans for investment projects in developing countries through major Japanese companies (overseas investment loans)
For further information
For further information, please contact the following departments
For further details of this facility or for consultation on specific business operations regarding the facility, please contact the following departments.
Corporate Finance Department
Business operations conducted by domestic firms (excluding those dealt with by International Finance Department, Western Japan)
International Finance Department,Western Japan
Business operations conducted by domestic firms located in the western Japan