TOKYO (Reuters) – The number of corporate bankruptcies in Japan fell at the fastest rate this year to hit the lowest in 50 years for a July, thanks to funding support from the government and banks, a private-sector credit research firm said on Tuesday.
There were 476 company bankruptcies in July, down 40% from the same month a year ago, Tokyo Shoko Research showed, pointing to government help for corporate financing amid a resurgence of the COVID-19 pandemic.
That was less than the previous July low of 482 in 1990, during the peak of Japan’s asset bubble economy, based on comparable data available since 1972.
It was the lowest corporate bankruptcy total in 50 years for the month of July, the credit research firm said, with the amount of liabilities at 71.5 billion yen ($647 million) down 30% from a year earlier.
However, pandemic-induced bankruptcies amounted to 138 in July, compared with 98 in the same month a year ago and bringing the total for January-July to 900, above the roughly 800 recorded in February-December 2020, it said.
With the prolonged pandemic undermining corporate financing, analysts don’t expect bankruptcies to remain low indefinitely.
($1 = 110.4300 yen)
(Reporting by Tetsushi Kajimoto; Editing by Mark Potter)