TOKYO, Dec 16 (Reuters) - The CEO of MUFG Bank

apologised on Monday for the theft by a former employee of more

than 1 billion yen ($6.5 million) in customer assets from safe

deposit boxes and promised better compliance measures.

The banking arm of Mitsubishi UFJ Financial Group ( MUFG )

said the employee used a spare key to access around 60 safe

deposit boxes at two Tokyo branches over a period of more than

four years.

"As a case which threatens the foundations of the banking

business, which is built on trust, we take this very seriously,"

Junichi Hanzawa, chief executive officer of MUFG Bank, told a

press briefing in Tokyo.

The bank is working on measures to prevent recurrence,

Hanzawa said.

The bank was also ordered to submit a report to Japan's

Financial Services Agency (FSA), it said in a statement.

MUFG Bank was first made aware of the case in October and

the employee was dismissed in November.

Mitsubishi UFJ Financial Group ( MUFG ), Japan's largest financial

group, was ordered in June by the FSA to submit business

improvement plans following breaches in "firewall" regulations

at its banking and securities arms.

The group is not the only major Japanese financial services

company hit by a scandal this year.

The reputation of Japan's largest securities firm, Nomura

Holdings ( NMR ), has also been hit by a market manipulation

case involving one of its traders in September and another

incident where an employee was charged with attempted murder and

robbery of company clients last month.

($1 = 153.6500 yen)