Japan's central bank chief apologized yesterday for an investment scandal that has set off calls for his resignation, and said the bank has set up a committee to review rules for its officials' assets.
Governor Toshihiko Fukui also said he wanted to serve out the rest of his term through March 2008.
"I am very, very sorry. I deeply apologize to the people," Fukui said at a news conference. "The Bank of Japan's compliance rules have been widely criticized. This must be taken seriously."
PHOTO: AP
Fukui has come under fire since stating last week that he had invested ¥10 million (US$86,000) seven years ago in a fund managed by Yoshiaki Murakami, who was arrested June 5 on suspicion of insider trading.
The incident has raised questions about the ethic standards for Japan's financial officials -- and comes at delicate time when the central bank is about to start raising interest rates amid signs of a long-awaited economic recovery here.
Fukui said the central bank yesterday set up a committee, including legal experts and outsiders, to review compliance regulations that would come up with a fix as soon as possible.
The Bank of Japan now requires its senior officers to report any investment sales, purchases or profits but does not impel them to sell holdings they already have or forbid them from investing in funds. Also, they have been advised not to engage in insider trading or take advantage of privileged information.
Kyodo News agency reported yesterday the value of Fukui's investment more than doubled in nearly seven years to ¥22 million (US$190,000).
But the final profit won't be known until the final sale settlement is completed later this month.
Fukui denied he violated ethical standards. But he acknowledged he should have been more careful about holding on to the fund after he became governor.
"I realize there is serious criticism and I accept it fully," he said. "I have always acted with strong integrity."
Separately, in a speech at the National Press Club in Tokyo later today, Fukui said the Bank of Japan needs to adjust interest rates from near zero without delay if the economy and prices follow the path the bank predicted.
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