Debts from Japanese corporate bankruptcies in October hit 8.6 trillion yen (79.6 billion dollars) in a whopping 1,253-percent jump from the same month last year, a private research agency said Wednesday.
Corporate failures jumped 22.7 percent year-on-year to 1,711 during the month, marking the 12th consecutive monthly increase, Teikoku Databank said in its monthly report.
Liabilities left by the collapsed firms skyrocketed from October 1999 to exceed eight trillion yen, a post war record and double the previous monthly high of 4.3 trillion yen reached in July, it said.
"The debt saw a sharp increase as massive failures, weighing in more than one trillion yen each, took place," Teikoku said.
The spectacular failure of two life insurance companies was responsible for the bulk of the figure, with Kyoei Life Insurance Co.'s debts alone exceeding those for all bankruptcies in July.
On October 20, Kyoei sought court protection from creditors to become Japan's biggest corporate failure since World War II, brought to its knees by 4.6 trillion yen in debt.
Kyoei's collapse came less than two weeks after Chiyoda Mutual Life Insurance Co. set a new record for the biggest post-war failure with liabilities worth three trillion yen.
The debt for October alone approaches the record 11-trillion-yen liabilities recorded in the whole of the first half of the fiscal year to September. The six-month period saw 9,473 corporate failures.
The agency said failures caused by poor sales numbered 1,325, accounting for 77.4 percent of the total.
"Amid falling consumer prices driven by consumers' choice of cheap goods, bankruptcies triggered by the recession continue to break new records," the agency said.
The number of employees of the bankrupt firms totaled 41,543 in October, the agency reported -- TOKYO (AFP)
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