Japanese banks chase up to $250 billion in dollars for US investment under trade pact

Japan’s three biggest banks—MUFG, Sumitomo Mitsui Banking Corporation and Mizuho—together with the state‑run Japan Bank for International Cooperation (JBIC) are seeking massive dollar funding to finance projects in the United States under the recent Japan‑US tariff agreement. The banks have already pledged up to ¥350 billion (about $2.2 billion) for an initial wave of projects and expect the total financing need to reach between $150 billion and $250 billion over the next two years, with private‑bank lending alone projected at more than $247 billion.

To obtain the dollars, the banks are weighing several options: issuing dollar‑denominated bonds, arranging syndicated loans, tapping swap lines with the Federal Reserve, or selling yen‑denominated assets to buy dollars. Officials have quietly approached Japan’s Ministry of Finance and the Bank of Japan for possible assistance, but the central bank traditionally provides dollar liquidity only in crisis situations. Market watchers warn that large‑scale dollar purchases could weaken the yen and push up U.S. Treasury yields, creating broader financial‑market repercussions.