* China-Japan relations rocked by island dispute
* Xinhua report suggests Beijing may want to snub Japan
* State-owned banks will reportedly not attend meeting
BEIJING, Oct 9 (Reuters) - China's delegation to the annual meetings of the IMF and the World Bank in Tokyo will not be led by its most senior finance officials, a report from state news agency Xinhua said on Tuesday, in what looked like a deliberate snub of Japan.
According to Chinese protocol, only the most senior officials usually lead such trips, but the report said China's deputy central bank governor and vice finance minister would be leading the central bank's delegation later this week instead.
That would imply that the governor of the People's Bank of China, Zhou Xiaochuan, and Finance Minister Xie Xuren, will not attend. China's central bank and finance ministry declined to comment when asked earlier by Reuters to confirm whether Zhou and Xie were headed to Tokyo.
If they did stay away, it would be the latest sign that a territorial dispute between Tokyo and Beijing is straining ties between Asia's two biggest economies.
Sino-Japanese relations deteriorated sharply in September after Japan bought the East China Sea islets that both Tokyo and Beijing claim, sparking anti-Japanese protests across China.
The disputed group of islands, called Senkaku in Japan and Diaoyu in China, are located near rich fishing grounds and potentially huge oil and gas reserves. Taiwan also asserts its sovereignty over the islets.
Japan is scheduled to host the International Monetary Fund and World Bank annual meetings for the first time in nearly half a century. About 20,000 people are expected to attend the event, making it one of the world's largest international conferences.
The brief Xinhua report said Yi Gang, vice head of the People's Bank of China, and Vice Finance Minister Zhu Guangyao, will "lead a delegation to the meeting".
The report did not mention the more senior Zhou and Xie and did not make it clear whether both officials will still be attending the meetings. Zhou is scheduled to speak at the IMF meeting and at a meeting on the sidelines later this week.
A receptionist at the hotel in Tokyo, where Zhou is scheduled to stay, told Reuters earlier today that Zhou has a reservation.
The Xinhua report comes a day after the agency said that China's state-owned banks will not attend the meetings in Tokyo.
China has sent its patrol ships into what Japan considers its territorial waters near the disputed islands in recent weeks, prompting Japan to lodge protests against China.
(Reporting by Sui-Lee Wee and Koh Gui Qing; Editing by Andrew Osborn)
Keywords: CHINA JAPAN/IMF