FACTBOX-Recent comments on BOJ governor selection

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Feb 25 (Reuters) - Bank of Japan Governor Toshihiko Fukui's term ends on March 19, and the government is expected to name candidates to succeed Fukui and the central bank's two deputy governors before the end of the month.

Current Deputy Governor Toshiro Muto is seen as the leading candidate to replace Fukui, though it was unclear if he could win the backing of the main opposition Democratic Party.

The opposition could block a nominee through its control of the upper house because the governor's appointment must be approved by both houses of parliament.

Following are recent comments by Japanese policymakers on the selection of the next governor.

ICHIRO OZAWA, LEADER OF THE DEMOCRATIC PARTY, THE MAIN OPPOSITION PARTY, Feb. 25, quoted by public broadcaster NHK as telling a news conference:

Ozawa acknowledged that Prime Minister Yasuo Fukuda has sounded him out on the possibility of holding direct talks on the BOJ succession issue but said the Democrats had decided against doing so.

"Since the discussions (with the prime minister) over a so-called grand coalition were held last year, the whole party has decided not to have such meetings ... I will not directly discuss it with Prime Minister Fukuda."

YUKIO HATOYAMA, SECRETARY-GENERAL OF THE OPPOSITION DEMOCRATIC PARTY, Feb 22, in a news conference:

"The situation is not simple as there are indeed strong opinions on the need for a separation between monetary and fiscal policy."

BUNMEI IBUKI, SECRETARY-GENERAL OF THE RULING LIBERAL DEMOCRATIC PARTY, Feb 22, in a news conference:

"The basic point is that parliament makes a decision after evaluating in an open forum the character and insights (of the candidate)." He earlier denied media reports that the party had taken Muto's name to the Democrats.

KAORU YOSANO, SENIOR MEMBER OF THE LIBERAL DEMOCRATIC PARTY, Feb 22, in a seminar.

"A simple academic would not do. The person (to become the new BOJ governor) must have a network of contacts, knowledge and experience and, at the same time, be able to epitomise the BOJ's role as stipulated in the law."

PRIME MINISTER YASUO FUKUDA, Feb. 20, in parliament:

"It requires sound insight on international finance as well as experience (to become the BOJ governor)."

"There are important responsibilities of managing monetary policy and achieving stability in the financial system. There is also a big responsibility in international finance, and it is growing important every year."

OZAWA, DEMOCRATIC PARTY LEADER, Feb. 19, in a news conference:

"If I were to appoint the BOJ governor, I would consider it in terms of how we can destroy the dominance of the bureaucracy in this country."

"We don't have the right to appoint, but we've said that we want the government to take our views into consideration."

FINANCE MINISTER FUKUSHIRO NUKAGA, Feb. 19. in parliament:

"At a time when countries face downside economic risks and market conditions remain unstable, especially in the United States, making decisions to avoid any policy vacuum will be beneficial for the Japanese people as well as the world economy."

"It is desirable that a new governor is selected mainly based on the person's character, not on where the person used to work."

HATOYAMA, DEMOCRATIC PARTY SECRETARY-GENERAL, Feb. 19, quoted by Japanese media:

"Many lawmakers from our party are critical of Mr. Muto. People's appraisal of his five-year-long performance (at the BOJ) not necessarily high."

"I don't hear opinions within the party that Muto would be OK. We need to come up with a logical explanation for why we would accept a person as governor whom we had opposed as a candidate to be deputy governor."

KENJI YAMAOKA, PARLIAMENTARY AFFAIRS CHIEF OF THE DEMOCRATIC PARTY, Feb. 18, to reporters:

"We have not told them which candidate is bad or how many candidates the government should propose. We will start our examination after the government puts forward candidates."

YOSHIMASA HAYASHI, DEPUTY CHAIRMAN OF THE RULING LIBERAL DEMOCRATIC PARTY'S UPPER HOUSE POLICY BOARD, Jan. 29, in an interview with Reuters:

"I think Muto is a leading candidate."

"At this stage, (the party) is unlikely to say 'no'."

"A delay would send a negative message to the market in the situation like this. The important thing is to select a new governor by March 19."

KATSUYA OKADA, A VICE PRESIDENT OF THE DEMOCRATIC PARTY, Jan. 17, in a speech to journalists:

"I have reservations about having a person who was the top of fiscal authorities as head of the central bank."

SADAKAZU TANIGAKI, LDP POLICY CHIEF, Jan. 17, in an interview with Reuters:

"If the nominee is rejected by the upper house, there may be a chance that the governor's position would be vacant. But Japan is a major financial market, and having no central bank governor would make the world anxious. We should not create a period of policy vacuum.

"Financial markets are very nervous right now, so Japan's central bank governor needs to have deep insight into the situation and have the ability to explain it appropriately to market participants and the public."

HATOYAMA, DEMOCRATIC PARTY SECRETARY-GENERAL, Jan. 11, quoted by Kyodo News:

"We should not leave the BOJ Governor post vacant. We should try to make the ruling parties understand our ideas so that it will be decided smoothly.

"We're not necessarily saying 'no' just because somebody was a bureaucrat."

OZAWA, DEMOCRATIC PARTY LEADER, Nov. 13, in an interview with Reuters:

"It is not desirable to have a situation in which there is no Bank of Japan governor."

Ozawa also said he had not made any decision on who was the best choice to become the next BOJ governor and that a candidate would not be ruled out because he was a former bureaucrat.

(Reporting by Tokyo Policy Desk)