Wolfgang Schaeuble will stay on as chairman of Germany's opposition Christian Democrats (CDU) following a crisis meeting of party leaders over a financial scandal.

	Reputation at risk The scandal so far The unification chancellor

There had been widespread speculation that Mr Schaeuble would be forced to step down after a series of revelations that party officials had contravened party funding law by taking undeclared political donations.

A CDU crisis meeting ran on two hours longer than expected on Tuesday.

Mr Schaeuble admits that he accepted campaign donations from an arms dealer whose revelations started the affair.

Speaking to reporters after the meeting, Mr Schaeuble said: "The CDU is in the worst crisis in its history."

Confidence

One party source is quoted as saying that the party leadership had rejected an offer by the 57-year-old Mr Schaeuble to quit because no obvious successor existed.

But his endorsement by party leaders strengthens Mr Schaeuble's hand in trying to clear up the scandal centered on former chancellor Helmut Kohl.

"The national party executive has expressed its confidence in Wolfgang Schaeuble," Thuringia governor Bernhard Vogel said.

Mr Schaeuble said the party expected Mr Kohl, who has refused to name the donors of some DM2m ($1m) of funds he accepted on behalf of the party in the 1990s, to either clear up his role in the affair or to face suspension as the party's honorary chairman.

A criminal investigation has already been launched into the activities of Mr Kohl, who led the party with a tight grip for 25 years, and still holds a parliament seat.

Mr Kohl was not present at Tuesday's meeting, and has rejected calls either to give up his seat in parliament or the honorary chairmanship of the CDU.

Earlier, the former interior minister Manfred Kanther resigned his seat.

Secret donations

The scandal involves the covering up of illegal, secret donations to the CDU and is reaching into all sections of the party.

So far, disclosures have topped DM33m ($17m), including the damaging revelations last Friday by Mr Kanther that the Hesse branch channeled DM13m ($6.8m) in campaign funds through a Swiss account back into Germany when he was state party chairman.

The money was falsely reported as bequests from abroad between 1989-96, some from Jewish donors.

A BBC correspondent says the public impression is of a party corrupted by 16 years in power.

Clean break

Chancellor Gerhard Schroeder has called for a re-run of the Hesse election although Roland Koch, the CDU's regional leader, has insisted he will not resign or call a new election.

But Christian Wulff, another CDU regional leader, said: "We have to make a very radical break and cut ourselves off from all those who are caught up in these scandals."

Mr Kohl's CDU leadership included 16 years in power and Mr Schaeuble was handpicked to succeed him as party leader.

Both men have been summoned before a parliamentary inquiry, which is to hold its first meeting later this week.

The CDU, under Mr Kohl, introduced the party financing law which requires donations exceeding DM20,000 (US$10,000) to be declared.