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Bank of Japan, Bank of Korea To Extend Bilateral Yen-Won Swap Arrangement

The Bank of Japan has agreed with the Bank of Korea to extend the bilateral yen-won swap arrangement for another three years to and including July 3, 2013.

The Bank of Japan agreed to enter into the bilateral yen-won swap arrangement with the Bank of Korea in May 2005, effective until July 2007. The arrangement was then extended for three years until July 3, 2010.

The maximum amount of the swap arrangement is $3bn equivalent in yen and won.

This arrangement is in line with the framework of the Chiang Mai Initiative in pursuit of stabilizing regional financial markets through supplying short-term liquidity.

The Bank of Japan said that it believes that this extension also serves to enhance mutual cooperation between the two central banks.