BOJ's Nishimura: Global financial market tension rising

TOKYO (Reuters) - Bank of Japan Deputy Governor Kiyohiko Nishimura said on Monday that tension in global financial markets is mounting as counterparty risks remain intact despite efforts by global central banks and governments to fight off the financial crisis.

"Due to strong awareness of counterparty risks in the dollar markets, the function of these markets is declining and Japan's financial market is also becoming unstable," Nishimura said at a seminar on Japanese and French financial markets.

(Reporting by Yasuhiko Seki and Sophie Hardach)