Opposition parties on Thursday harshly criticized the government’s handling of the troubled Long-Term Credit Bank of Japan during a Lower House committee meeting that resumed after a one-day opposition-camp boycott.

The opposition called for full disclosure of LTCB’s financial situation if taxpayers’ money is to be pumped into the bank.

The special committee for financial system stabilization was formed to debate a package of bills including the “bridge bank” bill, but focused on LTCB instead.

Keiichi Ishii, of Shinto Heiwa (New Party Heiwa), said it was impossible to discuss the issue without releasing the Financial Supervisory Agency’s findings of its LTCB inspection.

Prime Minister Keizo Obuchi and FSA Commissioner Masaharu Hino reiterated the government’s stance that findings of FSA inspections would not be disclosed. Hino also expressed a cautious position before the Diet, saying such information obtained by the government is confidential.

Meanwhile, Rikukai Sasaki, of the Japanese Communist Party, questioned the substance of the bad loans that LTCB plans to dispose of with the help of public money. In a restructuring package announced last Friday, LTCB intends to give up 750 billion yen of sour loans, including 520 billion yen loaned by three nonbank affiliates.

Sasaki pointed out that 70 percent of the loans from the Japan Leasing Corp, one of the nonbank firms, were extended to real estate companies, including dubious dummy firms. Sasaki questioned the use of taxpayers’ money to help cover up reckless management during the “bubble economy,” but the government gave no response.

Finance Minister Kiichi Miyazawa stressed that an LTCB failure poses international risks because of the size of the bank’s financial derivatives dealings, worth 50 trillion yen as of March.

If the LTCB defaults, other Japanese banks could be excluded from international derivatives operations, Miyazawa said. Derivatives are advanced tools to hedge various risks, such as foreign exchange turmoil.

The government stressed that its support for the LTCB is not aimed at rescuing the bank itself but preventing an international financial disaster.

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