Corporate bankruptcies in Japan declined 3.5 percent from a year earlier to 16,887 in fiscal 1999, but the amount of debt left behind by collapsed companies remained at a high level, a private think tank said Friday.
The number of bankrupt companies in the year to March 31 fell below 17,000 for the first time in three years, but this was the 10th-largest postwar figure, Teikoku Databank said in a report covering bankruptcies with debts of 10 million yen or more.
In fiscal 1999, the liabilities left behind by failed companies dropped 25.8 percent to 11.26 trillion yen, the third-biggest postwar figure. The amount was high because 18 of the bankrupt firms each left at least 100 billion yen in debt, including Yamaichi Securities Co., which owed 510 billion yen.
Teikoku Databank said concern about another banking industry crisis and the collapse of major firms subsided in the reporting year because of the central bank’s extremely relaxed monetary policy and the government’s expanded credit guarantee program for small companies.
Of the 16,887 bankruptcy cases, 12,332, or 73 percent, were caused by recession-linked factors, mostly sales declines. This was the largest postwar percentage in this category, surpassing the previous record of 71.1 percent in fiscal 1998, the research firm said.
By industry, bankruptcies declined in the manufacturing, wholesale, transportation-communications and services industries, but they increased in the construction and retail sectors, Teikoku Databank said.
In March, bankruptcies jumped 39.5 percent from a year earlier to 1,770 cases for the fifth straight monthly increase and the fourth consecutive month of a rise of over 30 percent.
This was the first time in 17 months for the monthly total to climb above 1,700.
The amount of liabilities left behind, however, shrank 79.7 percent from a year earlier to 646.79 billion yen.
Recession-caused bankruptcies in the month hit a record 1,342, surpassing the previous monthly record of 1,273 in June 1998. They accounted for 75.8 percent of the total, matching the worst postwar percentage, recorded in October 1999.