The Bank of Japan decided Tuesday to put off sales of stocks it purchased from private financial institutions to avoid any negative effects on financial markets, extending the period of share holdings by two years until the end of March 2016.

Previously, the central bank planned to hold on to the shares until the end of March 2014. It also decided to postpone the timing of completion of share sales by two years to the end of September 2021.

The decision comes despite about 50% rise in the benchmark Nikkei stock index so far this year, spurred by a steady recovery in the world's third-largest economy. But uncertainty lies ahead as a planned increase in sales tax in April could drag on the economy, while overseas economies have yet to fully recover.

"The decision was to avoid the sales causing an unintended impact on financial markets," said a BOJ official.

In an unusual move for a central bank, the BOJ bought shares held by financial institutions twice from November 2002 to September 2004 and February 2009 to April 2010, to help stabilize the country's financial system.

The purchases were designed to help reduce the risk that commercial banks were exposed to a fall in the value of their share holdings, enabling them to get rid of non-performing loans that burdened them after the collapse of asset-inflated bubble economy.

In October 2007, the BOJ began selling some of those shares as scheduled, but suspended the sales in October 2008 due to the global financial crisis.

The BOJ held Y1.3566 trillion ($13.2 billion) in shares as of September.

The Wall Street Journal