Consumer-loan firm Aiful Corp. has announced that the government’s plan to lower the interest rate cap on consumer loans will slash its full-year revenues 30 percent, or roughly 150 billion yen.
President Yoshitaka Fukuda told a news conference Tuesday that Aiful “will have to take fairly tough measures” in response to the plan, although he did not reveal specific restructuring steps, such as closing or consolidating branches.
Earlier Tuesday, Aiful said that for the business year to next March 31, it now expects to book a full-year net loss of 185.4 billion yen on a group basis — the company’s first net loss since it was founded.
The projected net loss contrasts sharply with an earlier projection, released in May, of a net profit of 52.54 billion yen, and with the previous year’s full-year net profit of 65.83 billion yen.
Aiful also revised down its estimate for revenues for the 12-month period to March 31 to 508.71 billion yen.
Aiful attributed the revisions mainly to increased reserves it has set aside to meet an expected rise in borrowers’ claims for reimbursements in connection with the gains it made from “gray zone” interest rates.
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