The number of corporate bankruptcies in Japan in June grew 6.3 percent from a year before to 780, hitting the highest monthly total for this year, Tokyo Shoko Research Ltd. said Wednesday.
The rise came after courts in the country, which had scaled back their operations, including proceedings related to corporate bankruptcies due to the spread of the novel coronavirus, fully resumed the services following the lifting of the government’s state of emergency over the virus in May.
Month on month, business failures surged 2½ times from May.
The number of bankruptcies caused by the fallout of the epidemic came to 94 in June, the highest monthly count ever.
Total liabilities at failed companies jumped 48.1 percent year on year to ¥128.8 billion in June because of an increase in large-scale bankruptcies, including that of White Bear Family, a travel agency based in the western city of Osaka, which left ¥27.8 billion of debts.
“The number of coronavirus-linked bankruptcies will continue increasing as there are concerns over a second wave of infections,” an official of Tokyo Shoko Research said.
The number of bankruptcies was largest in the service industry, which includes hotel and restaurant operators, standing at 278, up 24.1 percent, due to a plunge in foreign visitors to Japan and restrictions on going out amid the virus crisis.
Of the 10 surveyed sectors, five, including wholesalers and real estate companies, saw year-on-year growth in bankruptcies.
In January-June, corporate bankruptcies inched up 0.3 percent from a year before to 4,001, up for the first time for the first-half period since 2009, when the world was experiencing a financial crisis following the collapse of U.S. investment bank Lehman Brothers in September 2008.
The increase resulted from the October 2019 hike in Japan’s consumption tax rate to 10 percent from 8 percent and impacts of a mild winter, as well as the coronavirus crisis.
Total liabilities involved dropped 13.7 percent to ¥657.1 billion.
The Tokyo Shoko Research data covered bankruptcies involving liabilities of ¥10 million or more.
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