Japan LDP mulls recapitalising big banks -Kyodo

TOKYO, Oct 17 (Reuters) - Japan's ruling Liberal Democratic Party is considering schemes to recapitalise big banks with government money, Kyodo news agency reported on Friday.

As part of discussions to reinstate bills that would open the way for the government to inject public funds to prop up regional financial institutions, a party task force may seek to expand the schemes to bigger banks, the report said.

"Depending on how things come out, there may be a situation where megabanks get their capital replenished (with public funds) preemptively. We are thinking about preparing for that possibility," Hakuo Yanagisawa, the head of the task force, was quoted by Kyodo as saying.

Japan unveiled steps to stabilise its financial markets earlier this week, including a possible injection of public funds into regional banks that it said would be aimed at enhancing smooth financing for smaller firms facing a possible credit crunch. (Reporting by Yuzo Saeki)