26 February 2002, 09:27  Yanagisawa not ruling out pre-emptive public-fund injection into banks

TOKYO (AFX-ASIA) - Minister of Financial Affairs Hakuo Yanagisawa said he cannot rule out the possibility of the need to inject public funds into banks as a pre-emptive measure to prevent a financial crisis. "I don't think it is impossible that the government will inject public funds in a pre-emptive way because the existing law stipulates the government inject funds if there are signs of a financial crisis," he said. "Therefore, pre-emptive action is possible," he told a parliamentary Lower House budget committee. Yanagisawa heads the Financial Services Agency, the banking regulator, which is carrying out special inspections into banks' financial condition. Investors are concerned the probes will reveal banks are weakly-capitalised. Yanagisawa has remained resistant to public fund injections.

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