Bank of Japan Governor Toshihiko Fukui, under fire for what some see as poor judgement and ethical lapses over his personal finances, said on Tuesday he would take a pay cut for damaging the public's faith in the central bank.
Speaking after it emerged that he had more than doubled his money in a fund run by an arrested financier, Fukui said he would also donate the principal and net profit to charity.
Fukui was called to reappear before a parliamentary committee on Thursday to further explain his finances, including $87,000 he put into an aggressive equity fund set up by Yoshiaki Murakami, who is under arrest for suspected insider trading. The investment was made in 1999 when Fukui was in the private sector but he has come under intense criticism for leaving the money invested after he became central bank governor in 2003.
The governor of Japan's independent central bank cannot be dismissed unless he is convicted of a crime, goes bankrupt or is unable to perform his duties due to physical or mental problems. Fukui could decide to quit, however, if public opinion grows strongly against him and he loses the government's confidence. Almost half of respondents to a random public opinion poll by Kyodo news agency last weekend thought Fukui should step down.
But Prime Minister Junichiro Koizumi and cabinet ministers have strongly backed Fukui, widely regarded as one of the most respected central bank governors Japan has had in years. While apologising again on Tuesday, Fukui said he intended to stay on as governor but would take a 30 percent pay cut for six months.