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Consumer lender Takefuji Corp. reported a 144.23 billion yen group net loss Wednesday for the first half of the fiscal year, its first ever, as it was forced to create a large reserve to repay borrowers for excessive interest charges.

The loss was in stark contrast to the company’s earlier forecast of a 40.3 billion yen profit for the April-September period and the 27.37 billion yen profit recorded a year earlier.

Facing increased borrower claims against interest charges in the “gray zone” — high rates that have been ruled illegal — Takefuji set aside 272.04 billion yen in the first half, putting pressure on its bottom line.

The gray zone falls between two legal maximum interest rates on loans. The Interest Rate Restrictions Law caps lending rates at 15 percent to 20 percent, depending on the size of the loan, while under the Investment Deposit and Interest Rate Law, rates of up to 29.2 percent can be charged if borrowers agree in writing.

Consumer loan companies generally impose interest charges in the gray zone. The Financial Services Agency said Wednesday that 73.1 percent of the total amount of money consumers owed those lenders during fiscal 2005 was taken out on rates above 20 percent. The outstanding balance of uncollateralized consumer loans extended at these high rates was about 11.4 trillion yen, the FSA said.

Following a Supreme Court ruling in January that effectively invalidated gray-zone rates, more borrowers are demanding reimbursement for the excess charges.

“Circumstances have never been as harsh” as now, due partly to such borrower demands and the deteriorating image of lending firms, Takefuji said in its earnings report.

Takefuji’s group revenue declined 3.6 percent from a year earlier to 170.57 billion yen in the period. Pretax profit rose 13.3 percent to 67.06 billion yen.

Looking ahead, the company is predicting a group net loss of 109.5 billion yen for the full year through March 31, on 334.6 billion yen in revenue, compared with 46.92 billion yen in profit and 351.26 billion yen in sales a year ago.

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