Japan

["Ian Murray" <seamus2001@xxxxxxxxx>]

The Japan Times: May 17, 2002
Corporate failures rack up 1.48 trillion yen in liabilities

Liabilities left in the wake of corporate failures surged to 1.48
trillion yen in April, marking a year-on-year rise of 21.8 percent,
credit research institute Teikoku Databank said Thursday.

This figure is also the second highest since the end of World War II,
according to the private institute.

The stagnant economy was blamed for 74.5 percent of the 1,641 corporate
failures registered in April, up 0.6 percent.

April saw the third-highest number of failures since Teikoku began
compiling data in 1964.

The failures of a record six public companies drove total liabilities
above 1 trillion yen for the eighth straight month.

Weighed down by a sea of nonperforming loans, banks are losing their
stamina in terms of financing large companies that are unable to boost
profits, Teikoku said.

With banks finally being forced to cut losses and write off mounting bad
debts, the number of large bankruptcies is likely to surpass the record
20,841 failures seen in 1984, Teikoku said.

"Looking at the actual situation at corporations, there is no feeling
that the economy is bottoming out," said Katsuyuki Kumagai, general
manager of Teikoku's Information Department.

Although the Cabinet Office is reportedly ready to declare Friday that
the economy is either bottoming out or nearing a turnaround, the
bankruptcy rate shows little sign of abating, Teikoku said.