* Candidates' view on whether to stay in government critical
* Snap election possible
* Finance Minister Olaf Scholz is front-runner
By Madeline Chambers
BERLIN, Oct 26 (Reuters) - Germany's Social Democrats are due on Saturday to announce the result of a membership vote on a new leader who will decide whether to exit a loveless coalition with Chancellor Angela Merkel's conservatives.
The SPD will announce the result of the ballot of its 426,000 members at around 6 p.m. (1600 GMT). The leader will be officially decided by delegates at a conference in December but that is widely seen as a formality.
The new leader will take over Germany's oldest party at a time of turmoil. Polling at about 14%, it is just off all-time lows and has been leaderless since June when Andrea Nahles quit after the party's worst result in a European election.
Of the 12 candidates running on a joint ticket, the best-known, and probable frontrunner, is Finance Minister and Vice Chancellor Olaf Scholz. Standing with a little-known colleague from eastern Germany, he would stay in the government coalition.
However, the vote is expected to be fragmented and it is unclear whether Scholz will garner the 50% or more of the vote needed to avoid a run-off ballot in November, which might be more difficult for him to win.
A decisive factor for members is the candidates' view on whether to stay in government or leave, say analysts and pollsters.
Many members want the SPD to ditch the alliance with Merkel and reinvent itself in opposition. As Merkel's junior partner in 10 of the 14 years she has led Europe's biggest economy, they say the SPD has had to compromise too much on policy.
Walking out would probably trigger a risky snap election or possibly a minority government - both unappealing options for stability-loving Germans.
All candidates are running in pairs. Two of these, including Scholz and his running mate, want to stay in the coalition while two others - both on the party's left - are against, including one led by Norbert Walter-Borjans from Germany's most populous state, North Rhine-Westphalia.
The other two pairs, also on the left, are sceptical about remaining in government but have not been explicit.
Few of the candidates are household names and analysts say the protracted leadership campaign has merely highlighted the lack of quality in the top ranks of the party.
"There is no candidate that is convincing to voters and who also brings charisma - with an ability to generate passion combined with competence," said Frank Decker, politics professor at Bonn University.
The winners have a tough job ahead.
They will have to unite a party that has been bitterly divided between leftists and centrists since former SPD Chancellor Gerhard Schroeder's welfare and labour market reforms some 15 years ago.
Facing a surge in support for the Greens on the left and with the far-right Alternative for Germany (AfD) collecting protest votes, the decline of the pro-European party proud of chancellors including Willy Brandt has been dramatic.
It has lost two thirds of its support since 1998 and its leaders have failed to find an answer to Merkel. In the 2017 federal election, its share of the vote fell to its lowest level since 1933. (Reporting by Madeline Chambers Editing by Douglas Busvine and James Drummond)