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.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.