TOKYO (AP) _ The chief of Japan's financial reform agency resigned Friday amid a furor over remarks he made suggesting he would be lenient when inspecting bank operations.

Michio Ochi, the head of the Financial Reconstruction Commission, handed in his resignation hours after he insisted he would not quit.

``My comment caused a lot of trouble for the Cabinet,'' Ochi said. ``I had no choice but to resign.''

The furor began Saturday when Ochi spoke to a crowd of officials from credit unions and other financial institutions in a town north of Tokyo about upcoming inspections.

``If the method of examination is strict, please bring it to the attention of my office. The utmost consideration will be given,'' Ochi said, according to a tape released by the opposition Democratic Party.

The comments were controversial in Japan because the government has pumped massive amounts of public money into the banks to help them bounce back from a bad loan crisis. The crisis has been blamed on bad management and poor oversight by government regulators.

The Financial Reconstruction Commission is the government body overseeing efforts to clean up the industry, and inspections of the institutions are to be conducted from March to July.

Sadakazu Tanigaki, former director general of the Science and Technology Agency, was appointed to succeed Ochi.

The opposition had jumped on Ochi's comments, accusing him of pandering to the banking industry and using the scandal to pummel Prime Minister Keizo Obuchi's coalition government.

Three opposition parties stormed out of a Budget Committee meeting in the lower house of Parliament on Friday in protest.

``It's time for you to resign,'' Democrat Kazuhiro Haraguchi railed at Ochi.

Obuchi's government acknowledged Ochi's comments were troublesome.

The resignation defused a conflict that could have complicated upcoming parliamentary budget discussions.