August 10, 2007 (LPAC)--The Bank of Japan dumped 1 trillion Yen ($8.5 billion) into its financial system. The Bank of Australia has, similarly, lent A$4.95 billion ($4.2 billion), the most since 2003. Meanwhile Central Banks in the Philippines, Indonesia and South Korea said they are ready to provide more cash if required. Banking sources report that the latter banks have already injected credit.

The three-month Japanese inter-bank rate climbed one basis point to 0.792%, the highest since September 1998. The Australian bank bill swap rate jumped to .6725%, the highest since Oct. 24, 1996.

According to Bloomberg, Japan's 9 biggest banks have $8.5 billion dollars exposure to sub-prime mortgage backed securities, which is in reality much higher.

In Japan and other Asian markets stocks were down across the board. In Japan the down turn was led by the banking sector with Aosora Bank losing 8.3%; Mitsubishi UFJ Financial Group down 3.3% and Sumitomo Mitsui Financial Group, Japan's third largest bank losing, 2.9%. In Australia the slide was led by the troubled Macquarie Bank, which plunged by 6.8%. Stock markets in Japan, South Korea, Singapore, Australia all lost between 2 and almost 5%.

Moe Ibrahim, a fund manager with The Asia Debt Fund in Singapore, which manages about $365 million, said: "There's a variety of scenarios you can envision, all the way ... to something which has much broader implications that causes the world to collapse like a deck of cards."