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June 20, 2006, 6:12 a.m. EDT

BOJ chief's fund investment doubled

'I deeply apologize,' Fukui says; proceeds to go to charity

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By Chris Oliver, MarketWatch

HONG KONG (MarketWatch) -- Bank of Japan Governor Toshihiko Fukui revealed Tuesday his 1999 investment in the controversial Murakami fund more than doubled during a period of historically sluggish investment returns for Japanese fixed-income investors.

Documents submitted to lawmakers showed the value of Fukui's investment stood at 22.31 million yen at the end of last year, more than double his original investment of 10 million yen.

Fukui has faced a storm of criticism since revealing last week that he invested seven years ago in a fund run by Yoshiaki Murakami, who was arrested June 5 on charges of insider trading.

The investment period coincides with the Bank of Japan's "ultra-easy" monetary policy, which typically saw returns on government bonds and savings accounts yield only hundreds of yen annually on a similar investment of 10 million yen.

Fukui said the central bank had set up a committee, comprising legal experts and others, to review investment rules and compliance regulations for senior officials.

"I am very, very sorry. I deeply apologize to the people," Fukui said at a news conference, according to reports. "The Bank of Japan's compliance rules have been widely criticized. This must be taken seriously."

At the time he made the investment, Fukui was working for a private organization and had no official dealings with the Bank of Japan.

Fukui, who continues to hold the investment but has made plans to sell it at the end of the month, reportedly said he would not benefit personally and pledged to donate the proceeds to charity.

The Bank of Japan also revealed Fukui held shares in five different companies at the end of May: 10,000 shares in Mitsui O.S.K. Lines Ltd. /zigman2/quotes/204152844/delayed JP:9104 -0.60% , 10,000 shares of Nippon Steel Corp. /zigman2/quotes/209782682/delayed JP:5401 +1.85% , 5,000 shares of Kikkoman Corp. /zigman2/quotes/200008494/delayed JP:2801 -0.56% , 5,000 shares of Fujitsu Ltd. /zigman2/quotes/208459594/delayed JP:6702 +0.59% and 5,000 shares of Mitsui Fudosan Co. /zigman2/quotes/205394574/delayed JP:8801 +2.68% .

The central bank said Fukui held these same shares in January 2003, before he took up his current post as governor.

The Bank of Japan does not compel officials to sell holdings they already own. Senior officials, who are required to report any investment sales or purchases, are advised not to engage in insider trading or take advantage of privileged information.

/zigman2/quotes/204152844/delayed
JP : Japan: Tokyo
¥ 4,970.00
-30.00 -0.60%
Volume: 1.20M
July 27, 2021 3:00p
P/E Ratio
6.62
Dividend Yield
3.02%
Market Cap
¥598.10 billion
Rev. per Employee
¥115.67M
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/zigman2/quotes/209782682/delayed
JP : Japan: Tokyo
¥ 1,845.50
+33.50 +1.85%
Volume: 6.76M
July 27, 2021 3:00p
P/E Ratio
N/A
Dividend Yield
4.06%
Market Cap
¥1668.41 billion
Rev. per Employee
¥45.46M
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/zigman2/quotes/200008494/delayed
JP : Japan: Tokyo
¥ 7,090.00
-40.00 -0.56%
Volume: 268,800
July 27, 2021 3:00p
P/E Ratio
47.21
Dividend Yield
0.63%
Market Cap
¥1368.76 billion
Rev. per Employee
¥57.48M
loading...
/zigman2/quotes/208459594/delayed
JP : Japan: Tokyo
¥ 20,350.00
+120.00 +0.59%
Volume: 356,600
July 27, 2021 3:00p
P/E Ratio
20.10
Dividend Yield
1.08%
Market Cap
¥4025.76 billion
Rev. per Employee
¥28.41M
loading...
/zigman2/quotes/205394574/delayed
JP : Japan: Tokyo
¥ 2,642.00
+69.00 +2.68%
Volume: 2.26M
July 27, 2021 3:00p
P/E Ratio
19.68
Dividend Yield
1.67%
Market Cap
¥2475.62 billion
Rev. per Employee
¥83.68M
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Chris Oliver is MarketWatch's Asia bureau chief, based in Hong Kong.

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