BoJ retires the Great East Japan Earthquake facility, effective May 2027
Victoria Shinder2 min readAt the Monetary Policy Meeting of 17 and 18 September 2026, the Policy Board of the Bank of Japan adopted a package of four amendments to the principal terms and conditions governing its funds-supplying operations. The stated aim is the smooth conduct of market operations; the document was published on 18 September 2026.
The change common to all four is a single sentence about pricing. The interest rate on loans becomes the average of the rates set out in paragraph 4 of the Complementary Deposit Facility terms — the Policy Board decision of 29 January 2016 — taken as of the disbursement date and over the period the loan runs. It now governs the climate-response operation, the disaster-area operation, and the non-auction branch of the pooled-collateral operation.
The climate-response operation keeps a 50 trillion yen ceiling in total, with each counterparty limited to the amount it has outstanding in qualifying investment or lending with at least a year left to run, and in no case more than 10 trillion yen.
The third attachment is the one to mark. Under the heading of designated disasters, the Great East Japan Earthquake is struck out and replaced by None, and the one trillion yen ceiling attached to it is struck with it. Those two paragraphs take effect on 31 May 2027; the rate change and the redrafted purpose clause took effect immediately. Loans already disbursed keep their existing terms until they mature.
What it means
Two separate things are happening in one document and they should not be read as one.
The rate change is housekeeping with teeth. Four facilities built in different years had different pricing clauses; after this they all point at the same reference, fixed at the moment money goes out rather than drifting with whatever the facility's own drafting once said. That makes the facilities easier to operate consistently and it removes the possibility of a spread opening between them by accident. It is not a change in the level of anything.
The disaster clause is the substantive item. A facility opened in the aftermath of March 2011 is being wound down — not abolished, because the framework survives and can be pointed at a future disaster by a Monetary Policy Meeting decision, but emptied of its designation. The delay to the end of May 2027, and the rule that loans already out keep their old terms, are the mechanics of letting the remaining book run off rather than calling it in.
Nothing here touches the policy rate, the guideline for market operations or the pace of bond purchases, and none of it should be read as a signal about any of those. The document is an amendment to operating terms, and its own framing is administrative.