The number of corporate bankruptcies rose 12.8 percent in May from a year earlier to 1,724, increasing for the second consecutive month, a private research institute said Thursday.
The amount of liabilities left behind fell 39.1 percent to 1.02 trillion yen but remained above the 1 trillion yen mark for the fourth month in a row, Teikoku Databank said.
The number of failures was the largest since the beginning of the year and the fourth biggest for the month of May since the end of World War II. The total debt was the third-largest for the month of May in the postwar period.
The institute’s report covers bankruptcies with debts of 10 million yen or more.
Bankruptcies caused by the recession totaled 1,326, the second-largest on record, while the ratio of recession-induced failures to the total number came to 76.9 percent, remaining above 70 percent for the 22nd month in a row.
Failures of established companies, which had been in business for 30 years or more, came to 394, accounting for 22.9 percent of the total, staying above 20 percent for the 16th consecutive month.
By industry, construction bankruptcies rose 18.5 percent from a year earlier to 576, up for the first time in three months. Failures of manufacturers totaled 286, up 2.5 percent and rising for the second consecutive month.
Failures for wholesalers jumped 22.2 percent to 314, up for the 18th consecutive month, while those of retailers rose 5.5 percent to 231, up for the first time in three months.
Record hotel failures
A record 50 hotels and inns went bankrupt in the January-May period, seven more than a year earlier, a private research institute said Thursday.
Total liabilities came to 387.7 billion yen, Teikoku Databank said.
Hotels in regional cities and tourist sites are suffering the effects of excessive capital investment made during the bubble economy of the late 1980s, as well as a decline in the number of tourists, the research institute said.
The amount of liabilities left by failed hotels and inns in the first two months of the year was already more than the 285.3 billion yen for the whole of 2000, it said.
It now appears almost certain that the number of hotel bankruptcies in 2001 will exceed the record of 103 last year, the institute said.
“Many hotel operators are being forced into bankruptcy after failing to get additional funding from banks,” a Teikoku Databank official said.
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