"In some cases, there is a possibility that funds will be injected compulsorily," the prime minister's deputy press secretary Akitaka Saiki told a news conference on Wednesday.

He said if banks' capital levels fall below a certain level, "there is certainly reason for the government to intervene." He would not specify what the level would be.

Under the scheme, weak but solvent banks would ask for help and then be given injections of public cash, for which 25 trillion yen will be set aside. Eight other laws enacted on Monday will nationalise insolvent banks and sell off their bad loans.

But economists sounded a warning saying a voluntary schememay not work. Banks may be reluctant to ask for money for fear it would likely mean the sacking of top executives.

Tokyo's stock market has also given the passage of bills weak reception. The Nikkei 225 Index was off 66.51 points (0.5 per cent) at 13,176.28 by 0915 IST.

Chief cabinet secretary Hiromu Nonaka said the government may now make even apparently healthy banks apply for money in an effort to revive their capital levels.

"We should consider making a climate in which this could happen, led by the government's judgement," Nonaka told a news conference. Japan needs to avoid causing "market confusion" he added.

The nation's top economic advisory council heaped pressure on prime minister Keizo Obuchi on Wednesday and said tens of trillions of yen must be poured into viable banks.

"The government must, over a maximum three-year period, identify those banks which can be deemed to be viable and take initiative to boldly inject several tens of trillions of yen in public funds," the economic strategycouncil said.

The council, comprising business leaders and academics, submitted its report to Obuchi early on Wednesday. "I will do my best to realise (the proposal) by telling ministers what concrete steps they should take," the premier said.

Japan's press urged banks to swallow their pride and ask for public fund injections. The Nihon Keizai Shimbun, the country's leading business daily, said forcible injections were needed.

Other papers said the government was already planning a forcible injection of funds in most of the nation's 18 major banks as early as mid-November, when banks announce half-year earnings results.