Japan corporate bankruptcy outlook murky after disaster

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TOKYO, April 8 (Reuters) – The number of Japanese corporate
bankruptcies is likely to rise after the summer on the impact
from last month’s devastating earthquake and subsequent tsunami,
a research firm said on Friday, with the effects of government
spending on disaster relief expected to take some time to filter
through.

The number of bankruptcies fell 9.9 percent in March from a
year earlier to 1,183 cases, with six attributed to the impact
from the quake and tsunami, Tokyo Shoko Research showed.

Most of those bankruptcies were from outside the quake-hit
region as it was difficult to assess the state of many companies
in the area, the research firm said.

The decline in March was largely on government steps to help
small corporations, the firm said.

The level of the bankruptcy is likely to stay at the current
level until before the summer, but companies in a wide range of
industries could go bankrupt as the effects of government
spending on disaster relief and reconstruction could take some
time to materialise, Tokyo Shoko Research said.

Total debt involved fell 13.0 percent to 270.24 billion yen
($3.18 billion) in March, falling for the fifth month in a row,
the data showed.

Compared with the previous month, the number of bankruptcies
rose 19.85 percent and the amount of bankruptcy debt fell 34.11
percent.

For the fiscal year to the end of March 2011, Japanese
bankruptcies dropped 11.31 percent from a year before to 13,065
cases dropping below 14,000 cases for the first time in four
years. Total debt involved fell 33.79 percent to 4.72 trillion
yen.
($1 = 84.960 Japanese Yen)

(Reporting by Kaori Kaneko; Editing by Joseph Radford)

Japan corporate bankruptcy outlook murky after disaster