TOKYO -- It was the ultimate lowball bid. During an auction in September to raise funds for the Japan Oil, Gas and Metals National Corp., the winning bidder agreed to loan the money with a 0% interest rate. "Even zero is a blessing," an executive of a major bank said of the auction.
This is life in the upside-down world of negative interest rates, introduced nearly two years ago by the Bank of Japan in hopes of stimulating growth. For banks, which suffer losses by keeping deposits at the BOJ, it makes sense to loan money to an enterprise like Jogmec, an independent administrative agency backed by government guarantees.