REPEAT: MNI: BOJ Kuroda Diet Testimony Friday on Reappointment

Repeats Story Initially Transmitted at 12:16 GMT Feb 28/07:16 EST Feb 28

--Diet Committee To Hear Deputy Governor Nominees Monday 

     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda will testify Friday at

a confirmation hearing by the Lower House Steering Committee for his

reappointment to a second five-year term as Bank of Japan Governor, a

parliamentary official said Wednesday.

     Kuroda will discuss his monetary policy stance from 1300 to 1535 JST (0400

to 0635 GMT) Friday.

     He has so far failed to accomplish the thorny task of guiding zero

inflation to a stable 2% under the aggressive easing program that he launched in

April 2013, in the face of a plunge in crude oil prices and the stubborn

deflationary mindset held among businesses and households.

     On Monday, the government nominees for the deputy governors, Masayoshi

Amamiya and Masazumi Wakatabe, will also testify at the same committee from 1415

to 1610 JST (0515 to 0710 GMT), the official said.

     Amamiya and Wakatabe would replace Hiroshi Nakaso and Kikuo Iwata, whose

five-year term ends on March 19. Kuroda's current term ends on April 8.

     The Upper House will hold similar hearings for the three nominees later.

Given the ruling coalition's majority in both houses, the government nominations

are expected to be approved easily.

     The BOJ is widely expected to keep its current policy stance under the new

leadership.

     The central bank has said it will maintain massive asset purchases and

super-low interest rates until it achieves the 2% inflation target but it also

faces the need to fine-tune its policy stance as protracted easing is squeezing

profit margins for lenders and reducing fixed-income investment returns for

pension funds.

     If Kuroda, 73, were reappointed, he would become the first BOJ governor to

serve two terms since Masamichi Yamagiwa, who held the post from 1956 to 1964.

     Amamiya, 62, is the BOJ executive director in charge of monetary policy. A

career central banker, he has been responsible for drafting many of the bank's

monetary policy measures, including the policies on quantitative and quality

easing and negative interest rates.

     Wakatabe, who is known as a reflationist and advocates bold monetary easing

to overcome deflation, is an economics professor at Waseda University in Tokyo.

     Wakatabe, 52, has argued for raising the BOJ's annual pace of Japanese

government bond purchases from the current Y80 trillion to Y90 trillion and

broadening the range of financial assets that the bank buys.

     Prime Minister Shinzo Abe has said in parliamentary testimony that he has

"complete trust" in Kuroda's skills as a central bank chief, based in part on

his having served as a senior Ministry of Finance policymaker and having managed

a large international organization.

     Abe returned to power in late 2012, vowing to correct the strong yen and

overcome deflation with his policy mix of aggressive monetary easing, increased

fiscal spending and pro-growth structural reform plans.

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com