* BOJ mulls negative rates on lending to banks-Bloomberg
* Yen slips to 2-week low vs dollar after the report (Recasts, adds comments)
By Masayuki Kitano
SINGAPORE, April 22 (Reuters) - The yen hit a two-week low against the dollar on Friday after a media report said that the Bank of Japan could expand its negative interest rate policy beyond its current applications.
The BOJ is considering applying negative rates to its lending programme for financial institutions, Bloomberg reported on its website Friday.
The BOJ may consider the new step if the central bank decides to lower further the negative rate that it already applies to some bank reserves parked with the institution, the report said. BOJ's next two-day policy review ends on April 28.
The dollar rose to as high as 110.20 yen JPY= following the Bloomberg report, and was last trading at 110.13 yen, up 0.6 percent on the day.
The reported scheme may provide an added incentive for banks to provide loans for any reconstruction related funding needs following the recent earthquakes in southern Japan, said Masashi Murata, currency strategist for Brown Brothers Harriman in Tokyo.
"If you ask whether this will trigger a rise in the dollar against the yen toward 120 yen or 115 yen, I don't think it will have that kind of impact," Murata added.
The yen also fell against the euro, which rose 0.8 percent on the day to 124.45 yen EURJPY=R .
Against the dollar, the euro edged up 0.1 percent on the day to $1.1302 EUR= . (Editing by Sam Holmes)